Chicks with myeloblastic leukemia induced by avian myeloblastosis virus (AMV) exhibited increased levels of plasma granulocyte/monocyte (GM) colony-stimulating activity (CSA). Chromatography of plasma from AMV-infected chicks revealed that this CSA eluted in the first protein peak from a column of Sephadex G-200. A second protein peak from the same column contained an inhibitor of GM colony-formation. The presence of the inhibitor and the increased CSA was studied during the development of myeloblastic leukemia. The disease course was separated into two distinct phases: 1) an early phase characterized by the onset of viremia, the induction of leukemic colony-forming cells (CFC) in the marrow, and moderately increased marrow cellularity, 2) a late phase characterized by marked increases in the early parameters, dramatic increases in the number of myeloblasts and decreases in the number of erythrocytic cells. Induction of the GM-CFC-inhibitor occurred during the initial stages of the first phase. Increased GM-CSA occurred later in this phase. We conclude that induction of the inhibitor and increased CSA were associated with disease progression rather than ancillary characteristics of frank disease.