Infection of avian macrophages with Rous sarcoma virus does not induce any changes in the morphology, growth behavior, or expression of macrophage-specific proteins. The absence of cellular transformation does not result from a block in the synthesis of viral proteins, since infectious viruses are released from a majority of cells in the culture. In this report, we examine the synthesis, processing, and functional activity of pp60src in Rous sarcoma virus-infected macrophages to determine whether the absence of transformation is due to an alteration in the functional expression of pp60src. Although the absolute level of pp60src was reduced compared with fibroblasts, the protein exhibited the same phosphorylation pattern and subcellular distribution and was able to phosphorylate immunoglobulin in the immune complex-protein kinase assay. These results imply that the failure of Rous sarcoma virus to transform macrophage may be due to a restriction in the cellular response to a functional src protein, perhaps due to the absence of cellular products which are essential for mediating pp60src-induced transformation.