Transfection of mammalian CV1 cells with a recombinant M-gene pTM1 plasmid, driven by vaccinia virus-expressed phage T7 polymerase, resulted in the expression of matrix (M) protein, which is progressively released from the exterior surface of the transfected-cell plasma membrane. Exocytosis of M protein begins 2 to 4 h posttransfection and reaches a peak by 10 to 16 h posttransfection; dye uptake studies reveal that > 97% of cells are alive and have intact membranes at 16 h posttransfection. Density gradient centrifugation and labeling with radioactive palmitic acid revealed that the M protein is released from cells in association with lipid vesicles. Expression of M-gene deletion mutants suggests that exocytosis of M protein requires the presence of a membrane-binding site at N-terminal amino acids 1 to 50. Cells transfected with the pTM1 plasmid containing the M gene of the temperature-sensitive mutant tsO23 expressed ample quantities of the mutant M protein at permissive (31 degrees C) and restrictive (39 degrees C) temperatures, but the exocytosis of the mutant M protein occurred only at the permissive temperature. The tsO23 M gene has three site-specific mutations resulting in amino acid substitutions at residues 21, 111, and 227. Expression of wild-type and mutant M genes with mutations or revertants at each of these sites resulted in exocytosis of M protein at the nonpermissive temperature only when wild-type leucine was present at residue 111, but M-protein exocytosis was restricted (to some extent even at the permissive temperature) when mutant phenylalanine was present at residue 111. Past and present data indicate that a specific structural conformation of the M protein is responsible for the formation and budding of vesicles, a property of the M protein which probably also promotes vesicular stomatitis virus assembly and budding of virions from host cells.