The proto-oncogene ets-1 is a member of the ets family of genes that share homology with the viral oncogene, v-ets, of the avian leukemia virus E26. By using expression vectors, we demonstrate that the ets-1 gene transforms NIH3T3 cells and the ets-1 transfected cells form colonies in soft agar and induce tumors in nude mice. We have also determined that the ets-1 protein contains homology with the helix-loop-helix motif of the HLH family proteins, but lacks the basic domain upstream of helix I. Transfection of the NIH3T3 cells with ets-1 vectors results in the activation of the endogenous ets-1 gene. Using hybridization probes that can distinguish between transcripts from endogenous and exogenous templates, we show that the endogenous ets-1 gene is activated by the expression of the transfected exogenous ets-1. In contrast, the expression of transfected ets-2 has no effect on the endogenous ets-1 gene expression. The results indicate that the ets-1 proto-oncogene is positively autoregulated by its product.