The generation of retroviral vectors that infect specific cell types through recognition of cell surface antigens is a promising and effective approach to targeted gene therapy of cancer. Carcinoembryonic antigen (CEA), a highly characterized, cell surface glycoprotein overexpressed by various tumor cells, provides a specific tool for tumor tissue-specific targeting by retroviral vectors. The conventional suicidal gene delivery systems need additional drugs other than their gene products. The inducible nitric oxide synthase (iNOS) gene product yields nitric oxide (NO), which directly induces autocytotoxicity and cytolysis of bystander cells. In the present study, we have developed a novel bifunctional Moloney murine leukemia virus-based recombinant retroviral vector that displays a chimeric envelope protein containing a single-chain variable fragmented (scFv) antibody to CEA and carries the iNOS gene in the genome. The resultant bifunctional retroviral vector showed a specific delivery of the iNOS gene to human CEA-expressing carcinoma cells, resulting in the direct and efficient killing of CEA-expressing carcinoma cells by induction of apoptosis. This is the first report of successful killing of CEA-expressing cells by specific targeting of the iNOS gene. This approach may offer a one-step procedure for effective gene therapy of CEA-expressing tumors.