Herpesvirus saimiri strain C488, a T-cell tumor virus of New World primates, transforms human T lymphocytes to stable interleukin-2-dependent growth without need for further stimulation by antigen or mitogen. The transformed cell lines show the phenotype of activated mature T cells and retain many essential features of the primary parental cells, e.g., antigen specificity. In contrast to transformed New World monkey T cells, the human lines do not support lytic growth of the virus, even after chemical stimulation. Here we show that many viral genes remain silent during episomal persistence. However, the viral oncogene stpC is predominantly transcribed and translated to a stable cytoplasmic protein of 20 kDa that is heterogeneously expressed in individual cells. This 1.7-kb mRNA is bicistronic, encoding also Tip, a viral protein interacting with the T-cell-specific tyrosine kinase Lck. stpC/tip transcripts are heavily induced upon stimulation by mitogen or phorbol ester. Block of protein synthesis does not abolish transcription: treatment with cycloheximide greatly induces stpC/tip mRNA levels. Thus, this gene complex is regulated similarly to early T-cell activation genes. Constitutive and induced expression engage different transcription start sites. The T-cell regulation of the viral genes stpC and tip may contribute to the T-cell tropism of growth transformation by herpesvirus saimiri.