The latent membrane protein 1 (LMP1) of Epstein-Barr virus (EBV) is an essential component of the viral machinery that orchestrates cellular transformation and oncogenesis. The critical role of LMP1 in transformation has been established through recombinant genetic analysis of the EBV genome, ectopic expression in cell lines and transgenic mice and immunohistochemical analysis of EBV- associated tumor specimens. The principal mechanism of LMP1 function is based on mimicry of activated cell surface receptors of the tumor necrosis factor superfamily. LMP1 signaling culminates in the activation of transcription factors NF-kappaB, AP1 and STAT1/3, which have been tightly linked to prevention of apoptosis and malignant transformation. The molecular mechanisms of LMP1 function will be reviewed in this report.