Winged helix transcription factors act as important regulators of embryonal development and tissue differentiation in vertebrates and invertebrates. Identification of the retroviral oncogene v-qin as a member of the winged helix family showed that these developmental regulators also have oncogenic potential. We used low-stringency hybridization of a chicken embryonic cDNA library to isolate cDNA clones coding for the three chicken winged helix (CWH) proteins, CWH-1, CWH-2, and CWH-3. The CWH genes are transcribed in a tissue-restricted pattern in adult and embryonic chicken tissues. The CWH proteins bind to conserved DNA binding sites for winged helix proteins in a sequence-specific manner. Expression of the CWH proteins from replication-competent retroviral RCAS vectors induces changes in morphology and growth pattern of chicken embryo fibroblasts. CWH-1 and CWH-3 also induce anchorage-independent growth in agar. Chicken embryo fibroblasts expressing the RCAS constructs release replication-competent viruses that are able to elicit the same cellular changes as the parental plasmid DNA. Our results suggest that winged helix transcription factors not only function as regulators of development and differentiation but also have the potential to stimulate abnormal cell proliferation.