Molecularly cloned proviral DNA of avian replication-defective retrovirus Mill Hill No. 2 (MH2) was analyzed. The MH2 provirus measures 5.5 kb including two long terminal repeats (LTR), and contains a partial complement of the structural gene gag, 1.5 kb in size, near the 5' terminus, and a 1.3-kb segment of the v-myc transforming gene near the 3' terminus. These v-myc sequences are closely related to the v-myc transforming gene of avian acute leukemia virus MC29, and to the cellular chicken gene c-myc. The gag and myc domains on the MH2 provirus are separated by unique sequences, 1.3 kb in size and termed v-mil, which are unrelated to v-myc, or to other oncogenes or structural genes of the avian leukemia-sarcoma group of retroviruses. Normal chicken DNA contains sequences closely related to v-mil, termed c-mil. Analyses of chicken c-mil clones isolated from a recombinant DNA library of the chicken genome reveal that c-mil is a single genetic locus with a complex split gene structure. In the MH2 genome, v-mil is expressed via genome-sized mRNA as a gag-related hybrid protein, p100gag-mil, while v-myc is apparently expressed via subgenomic mRNA independently from major coding regions of structural genes. The presence in the MH2 genome of two unrelated cell-derived sequences and their independent expression may be significant for the oncogenic specificities of this virus.