Inoculation of newborn mice with the murine polyoma (Py) virus leads to tumor formation in a wide range of tissues. In order to investigate viral oncogenesis, we generated transgenic mice carrying eitherthe Py large T antigen (LT) gene or the Py middle T antigen (MT) gene linked to Py early region regulatory sequences. While Py LT mice exhibit no phenotype, Py MT mice develop multifocal tumors of the vascular endotheliurn. These hemangiomas are lethal to the animals and can be passaged in vivo. Transgene RNAs and protein are present in both hemangiomas and the testes of these mice, and the Py middle T protein in both tissues is complexed to a cellular tyrosine kinase. The expression of complexed middle T protein in both tumorigenie endothelial cells and unperturbed testes implies that endothelial cells may be particularly susceptible to the action of the middle T oncogene. These observations indicate that Py middle T disrupts the normal strict controls on vascular growth, and suggest that Py MT transgenic mice will provide a model for studying the control of angiogenesis.