Bovine leukemia virus (BLV) is closely associated with the development of B-cell leukemia and lymphoma in cattle. BLV infection has also been studied extensively in an in vivo ovine model that provides a unique system for studying B-cell leukemogenesis. There is no evidence that BLV can directly infect ovine B cells in vitro, and there are no direct data regarding the oncogenic potential of the viral Tax transactivator in B cells. Therefore, we developed ovine B-cell culture systems to study the interaction between BLV and its natural target, the B cell. In this study, we used murine CD154 (CD40 ligand) and gamma-chain-common cytokines to support the growth of B cells isolated from ovine lymphoid tissues. Integrated provirus, extrachromosomal forms, and viral transcripts were detected in BLV-exposed populations of immature, rapidly dividing surface immunoglobulin M-positive B cells from sheep ileal Peyer's patches and also in activated mature B cells isolated from blood. Conclusive evidence of direct B-cell infection by BLV was obtained through the use of cloned B cells derived from sheep jejunal Peyer's patches. Finally, inoculation of sheep with BLV-infected cultures proved that infectious virus was shed from in vitro-infected B cells. Collectively, these data confirm that a variety of ovine B-cell populations can support productive infection by BLV. The development of ovine B-cell cultures permissive for BLV infection provides a controlled system for investigating B-cell leukemogenic processes and the pathogenesis of BLV infection.