The 44-amino-acid E5 protein of bovine papillomavirus type 1 is the smallest transforming protein yet described. Previous results from our laboratory indicate that a hydrophobic core and specific carboxyl-terminal amino acids are required for the E5 protein to exert its transforming function. In this study, additional substitution mutations were generated in the E5 gene to determine the minimal amino acid sequence requirements for focus formation in mouse C127 cells. In most cases examined, substitution of the hydrophobic middle third of the E5 protein with unrelated hydrophobic sequences severely inhibited transforming activity. However, we have identified one hydrophobic amino acid sequence apparently unrelated to the wild-type one that can replace the middle third of the wild-type E5 protein without affecting the ability of the protein to stably transform cells or interact with cell membranes. Furthermore, a mutant E5 protein in which only the carboxyl-terminal 16 amino acids of the protein have been derived from E5 sequences retains transforming activity. Since several residues in the carboxyl-terminal portion of the E5 protein can be freely substituted with different amino acids (B. H. Horwitz, A. L. Burkhardt, R. Schlegel, and D. DiMaio, Mol. Cell. Biol. 8:4071-4078, 1988), the results reported here imply that much of the specific information necessary for cell transformation can be supplied by a subset of the carboxyl-terminal 16 amino acids of this protein.