The Epstein-Barr virus (EBV)-encoded leader protein EBNA-LP is made up of several 66-amino-acid repeats (the W1W2 domains) linked to a unique 45-amino-acid C-terminal sequence (the Y1Y2 domain). This protein is highly expressed along with a second nuclear antigen, EBNA-2, during the initial stages of virus-induced B-cell transformation. While EBNA-2's essential role in transformation as a transcriptional activatory is well documented, very little is known about EBNA-LP function except that recombinant viruses lacking the EBNA-LP Y1Y2 exons show reduced, but still detectable, transforming ability. This was taken as evidence that EBNA-LP plays an auxiliary role but is not essential for transformation. A recent study showed that EBNA-LP could cooperate with EBNA-2 in activating cyclin D2 transcription in resting B cells (A.J. Sinclair, L Palmero, G. Peters, and P.J. Farrell, EMBO J. 13:3321-3328, 1994). Here we report that EBNA-LP can also cooperate with EBNA-2 in up-regulating expression of the major EBV effector protein of B-cell transformation, latent membrane protein 1 (LMP1). In transient-transfection assays, EBNA-LP enhanced the level of EBNA-2-induced LMP1 expression by 5- to 10-fold in one Latency I Burkitt's lymphoma cell line, Eli-BL, and was absolutely required, along with EBNA-2, to induce LMP1 in a second line, Akata-BL. These changes in LMP1 protein expression appeared to be reflected at the transcriptional level. A study of EBNA-LP mutants showed that this cooperative function mapped to the W1W2 repeat domain rather than to Y1Y2. Because a Y1Y2-deleted form of EBNA-LP may therefore retain some aspects of wild-type function, the original data from virus recombinants leave open the possibility that EBNA-LP is actually an essential transforming gene.