The single protein encoded by Abelson murine leukemia virus is a fusion of sequence from the retroviral gag genes with the v-abl sequence. Deletion of most of the gag region from the transforming protein results in a virus capable of transforming fibroblasts but no longer capable of transforming lymphoid cells. Smaller deletions in gag reveal that p15 gag sequences are responsible for this effect, whereas deletion of p12 sequences had no effect on lymphoid transformation. In transformed fibroblasts, p15-deleted and normal proteins had similar activities and subcellular localization. When the p15-deleted genome was introduced into previously transformed lymphoid lines, its protein product exhibited a marked instability. The tyrosine-specific autophosphorylation activity per cell was less than 1/20th that of the nondeleted protein. Although pulse-Ia-beling showed that the p15-deleted protein was synthesized efficiently, immunoblotting demonstrated that its steady-state level was less than 1/10th that of the nondeleted Abelson protein. The specific instability of the p15-deleted protein in lymphoid cells explains the requirement of these sequences for lymphoid but not fibroblast transformation.