Tel is an Ets transcription factor that is the target of chromosome translocations in lymphoid and myeloid leukemias and in solid tumors. It contains two functional domains, a pointed oligomerization domain and a DNA-binding domain. Retroviral transduction of a wild-type Tel cDNA into a clonal subline of NIH3T3 fibroblasts resulted in a striking morphologic change: at confluency, the cells reorganized into a specific "bridge-like" pattern over the entire surface of the culture dish, and started migrating, thereby leaving circular holes in the monolayer. Thereafter, formation of cellular cords became apparent. This sequence of events was inhibited by coating the culture dishes with fibronectin and collagen IV. Retroviral transduction of Tel into MS1 endothelial cells reproduced the aggregation phenotype, but not the cellular cord formation. Tel-mutagenesis showed that both the pointed domain and the DNA-binding domain of Tel are required for the morphologic change. Other Ets family genes, Fli-1 and Ets-1 that are both endogenously expressed in endothelial cells, could not induce this morphologic change. Exogenous Tel expression is associated with transcriptional upregulation of entactin/nidogen, Smad5, Col3a1, CD44 and fibronectin, and downregulation of Col1a1 and secretory leukocyte protease inhibitor. Interestingly, Tel, Smad5, fibronectin, Col1a1 and Col3a1 all have essential roles during vascular development.