Human T-cell leukemia virus type 1 (HTLV-1) is the etiologic agent of adult T-cell leukemia. Tax, the viral protein, is thought to be crucial in the development of the disease, since it transforms healthy T cells in vitro and induces tumors in transgenic animals. We examined the effect of Tax activity on the growth of the interleukin-2 (IL-2)-dependent T-cell line CTLL-2. Stable expression of Tax in CTLL-2 transformed cell growth from being IL-2 dependent to IL-2 independent. Tax stimulated transcription through NF-kappaB and the cyclic AMP-responsive element-like sequence in the HTLV-1 promoter. The finding of Tax mutants segregating these two pathways suggested that the NF-kappaB pathway was essential for IL-2-independent growth of CTLL-2 cells while the CRE pathway was unnecessary. However, both pathways were necessary for another transformation-related activity (colony formation in soft agar) of CTLL-2/Tax. Our results show that Tax has at least two distinct activities on T cells, and suggest that Tax plays a crucial role in IL-2-independent T-cell transformation induced by HTLV-1, in addition to its well-known IL-2-dependent cell transformation.