Human T-cell leukemia virus (HTLV) Tax protein has been implicated in the HTLV oncogenic process, primarily due to its pleiotropic effects on cellular genes involved in growth regulation and cell cycle control. To date, several approaches attempting to correlate Tax activation of the CREB/activating transcription factor (ATF) or NFkappaB/Rel transcriptional activation pathway to cellular transformation have yielded conflicting results. In this study, we use a unique HTLV-2 provirus (HTLV(c-enh)) that replicates by a Tax-independent mechanism to directly assess the role of Tax transactivation in HTLV-mediated T-lymphocyte transformation. A panel of well-characterized tax-2 mutations is utilized to correlate the respective roles of the CREB/ATF or NFkappaB/Rel signaling pathway. Our results demonstrate that viruses expressing tax-2 mutations that selectively abrogate NFkappaB/Rel or CREB/ATF activation display distinct phenotypes but ultimately fail to transform primary human T lymphocytes. One conclusion consistent with our results is that the activation of NFkappaB/Rel provides a critical proliferative signal early in the cellular transformation process, whereas CREB/ATF activation is required to promote the fully transformed state. However, complete understanding will require correlation of Tax domains important in cellular transformation to those Tax domains important in the modulation of gene transcription, cell cycle control, induction of DNA damage, and other undefined activities.