Human T-cell leukemia virus type 1 (HTLV-1) is the etiologic agent of adult T-cell leukemia (ATL) and a trans-acting viral function was proposed to be involved in ATL development because of the non-specific provirus integration in leukemic cells and the frequent immortalization of helper T-cells by in vitro infection. An extra sequence "pX" in the HTLV-1 genome codes for three proteins, p40x-, p27x- and p21x-, and the p40x- is trans-activator of transcription from the viral LTR. A sequence of 21 bp repeats in the LTR was found to be an enhancer and respond to the trans-activation by p40x-. The transient expression of p40x- also activates a cellular gene for interleukin 2 receptor (IL-2R) in helper T-cell lines. This induction of IL-2R may explain the mechanism of preferential growth of HTLV-1 infected cells and may be an early event of ATL development. For practical purposes, the env gene fragments was expressed in E. coli as fusion proteins with beta-galactosidase. Using these fusion proteins, a diagnostic system detecting anti-env antibodies was developed. Immunization of monkeys with these envelope-fusion proteins protected the monkeys from the viral infection, suggesting possible usage of envelope proteins as vaccine.