The replication (rep) gene of the human parvovirus adeno-associated virus (AAV) is a pleiotropic effector of numerous viral functions and experts profound effects on cellular transformation. Of the four Rep proteins, the primarily nuclear Rep78 and Rep68 direct AAV DNA replication, trans activation of the capsid (cap) gene promoter, and inhibition of cellular proliferation mediated by various oncogenes. In an initial attempt to define functional domains in Rep78, we have constructed a comprehensive set of XhoI linker insertion and deletion mutations in the rep gene. Each of the mutant genes has been expressed in cell culture and assayed for the following functions: (i) nuclear localization, (ii) AAV DNA replication, (iii) trans activation of the AAV capsid gene transcription promoter, and (iv) suppression of cellular transformation mediated by the adenovirus E1a and an activated ras oncogene pair. Modest disruptions in the normal conformation of Rep78 inactivated its AAV DNA replication function and trans activation of the cap gene promoter. Linker insertion mutations in the amino-terminal one-third of the protein inactivated Rep78's ability to suppress oncogene-mediated cellular transformation. The transformation suppression domains are not limited to the amino-terminal regions, however, since deletions throughout the protein altered its suppression capabilities. A putative nuclear localization signal that is essential for each of the above functions was found in the Rep proteins. These results provide a preliminary screening of the functional domains in the AAV Rep proteins and pave the way for more subtle mutational analysis.