Notch proteins are plasma membrane-spanning receptors that mediate important cell fate decisions such as differentiation, proliferation, and apoptosis. The mechanism of Notch signaling remains poorly understood. However, it is clear that the Notch signaling pathway mediates its effects through intercellular contact between neighboring cells. The prevailing model for Notch signaling suggests that ligand, presented on a neighboring cell, triggers proteolytic processing of Notch. Following proteolysis, it is thought that the intracellular portion of Notch (N(ic)) translocates to the nucleus, where it is involved in regulating gene expression. There is considerable debate concerning where in the cell Notch functions and what proteins serve as effectors of the Notch signal. Several Notch genes have clearly been shown to be proto-oncogenes in mammalian cells. Activation of Notch proto-oncogenes has been associated with tumorigenesis in several human and other mammalian cancers. Transforming alleles of Notch direct the expression of truncated proteins that primarily consist of N(ic) and are not tethered to the plasma membrane. However, the mechanism by which Notch oncoproteins (generically termed here as N(ic)) induce neoplastic transformation is not known. Previously we demonstrated that N1(ic) and N2(ic) could transform E1A immortalized baby rat kidney cells (RKE) in vitro. We now report direct evidence that N1(ic) must accumulate in the nucleus to induce transformation of RKE cells. In addition, we define the minimal domain of N1(ic) required to induce transformation and present evidence that transformation of RKE cells by N1(ic) is likely to be through a CBF1-independent pathway.