Transformed cells have been isolated from the bone marrow of reticuloendotheliosis virus (REV)-infected, moribund chicks. These cells have been maintained in vitro through more than 30 serial passages. The cells induce solid tumors when inoculated into the wing web of day-old chickens, and cell-free filtrates induce reticuloendotheliosis. Virus particles recovered after cocultivation of bone marrow cells and chicken embryo cells band at a density of 1.16 g/cm3 in sucrose gradients. The virions contain 64S and 4S RNA species and a polypeptide composition similar to that of REV and distinct from that of Rous sarcoma virus. Complement fixation tests indicate that viruses of the avian leukosis-sarcoma complex are not present in virus concentrated from these cultures.