A number of newly isolated clonal cell lines derived from diploid mouse embryo cells transformed by SV40 were examined in vitro and in vivo. Although these lines showed the properties that define transformation in vitro, they were not tumorigenic for many passages after their initial isolation. Cells from tumours eventually produced by the SV40-transformed cells were fused with diploid mouse embryo cells. The hybrids formed were initially non-tumorigenic. This indicates that a normal diploid cell can suppress the malignant phenotype of a tumorigenic SV40-transformed cell. The hybrid cells did, however, express the SV40 T antigen and they nad a clearly transformed phenotype in vitro. It thus appears that neither the transformed phenotype nor the expression of the SV40 T antigen are enough to endow a cell with the ability to grow progressively in vivo. The relationship between the transformed phenotype and tumorigenicity was further studied by fusing malignant mouse melanoma cells with non-tumorigenic SV40-transformed cells. The hybrids expressed the transformed phenotype in vitro but unable to form tumours in vivo. The changes that occur in cells after transformation by SV40 do not apparently affect the ability of these cells to suppress the malignant phenotype of tumour cells.