Kaposi's sarcoma (KS)-associated herpesvirus (KSHV) (also known as human herpesvirus 8) is a gamma-2 herpesvirus believed to be the etiologic agent responsible for KS. The pathogenesis of this potentially life-threatening neoplasm is complex and unclear, and it is currently unknown how KSHV causes KS. Id (named for inhibitor of DNA binding or inhibitor of differentiation) proteins were identified in 1990 and found to be naturally occurring dominant-negative inhibitors of basic helix-loop-helix transcription factors. Id-1, the most well-studied member of this family, has since been shown to play a key role in several biological systems including cellular differentiation, cell cycle regulation, and tumorigenesis. In this report, we demonstrate that Id-1 is expressed at high levels in KS tumor cells both in vitro and in vivo but is expressed at relatively modest levels in endothelial cells (ECs), the likely precursor of the KS tumor cell. Infection of precursor cells with KSHV may be responsible for this enhanced expression, as KSHV infection induced Id-1 27-fold in ECs under our experimental conditions. Furthermore, we demonstrate that the KSHV-encoded latency-associated nuclear antigen (LANA) protein appears to be involved. Expression of LANA in ECs resulted in Id-1 induction that was almost identical to the induction seen with KSHV-infected ECs. These results demonstrate the expression of Id-1 in KS tumor cells and indicate the KSHV LANA protein may be, at least in part, responsible. This may be an important mechanism by which KSHV allows KS tumor cells to escape normal cell cycle regulation and enhances their proliferation.