Due to the peculiar type of replication and genome structure, retroviruses (RNA tumor viruses) are characterized by an intensive interaction with the genome of the infected cell. For replication, transcription of the viral RNA genome into double-stranded DNA and subsequent integration of the viral information into the cellular genome are requisite. The recombinatory events with the cellular DNA provide ample opportunities to generate new viral genome structures with altered information and to influence the expression of cellular genes. The lack of specificity of the integration process may lead to inactivation of cellular genes by insertion mutagenesis. The enhancer and promoter sequences of the proviral LTR (long terminal repeat) regions are able to activate the expression of cellular genes in the neighborhood of integration sites. Transforming retroviruses have acquired cellular genes as oncogenes the transcriptional products of which may trans-activate other genes of the host cell. Retroviral infection may result in malignant transformation and alteration of the differentiation pattern of the invaded cell. Depending on the cell type, a loss of expression of cellular functions (dedifferentiation) or an induction of differentiation processes is noticeable. The demonstration of cellular oncogenes (proto-oncogenes) and their activation by retroviruses has initiated new perspectives in understanding the regulation of cell growth and differentiation as well as the formation of tumors at the molecular level.