Acute promyelocytic leukemia (APL) is characterized by the 15;17 chromosomal translocation. Cloning experiments have established that the chromosome 17 breakpoint maps to the RAR alpha and the 15 to the myl locus. The resulting chimeric gene is transcribed as a myl/RAR alpha fusion mRNA. By isolating both normal myl and APL myl/RAR alpha cDNAs, we showed that the myl/RAR alpha mRNA encodes for a putative fusion protein with a molecular weight of about 103 kDa, which is made up of 530 amino acids derived from the myl N-terminus and 402 amino acids originating from the RAR alpha C-terminus. The protein includes the RAR alpha DNA and retinoid-binding regions but lacks the A portion of the N-terminal region (A/B region) which is thought to contain one of the RAR alpha transactivation domains. The myl/RAR alpha protein acted as a retinoid-inducible transcription factor with both ligand-independent repressor and ligand-dependent activator functions in transactivation experiments of a retinoic acid-responsive gene. Myl/RAR alpha exerted this dual function three times more effectively than RAR alpha and had about 10-fold greater affinity for RA than RAR alpha. Comparison of myl/RAR alpha genomic and cDNA sequences from the same case demonstrated that both chromosome 15 and 17 breakpoints occurred within introns and the myl and RAR alpha sequences are spliced in the same polyadenylated RNA.