MH2, an avian retrovirus containing the v-myc and v-mil oncogenes, rapidly transforms chick hematopoietic cells in vitro. The transformed cells belong to the macrophage lineage and proliferate in the absence of exogenous growth factors. Here we analyze a series of MH2 deletion mutants and show that these two oncogenes together establish an autocrine growth system in which v-myc stimulates cell proliferation, while v-mil induces the production of chicken myelomonocytic growth factor (cMGF). We also demonstrate that these two oncogenes cooperate in vivo. MH2 efficiently induces monocytic leukemias and liver tumors, while deletion mutants lacking either a functional v-mil or v-myc do not.