Sox proteins belong to the superfamily of high mobility group (HMG) proteins. Sox3 is expressed predominantly in the immature neuroepithelium. Ectopic expression of Sox3 causes oncogenic transformation of chicken embryo fibroblasts (CEFs). The oncogenicity of Sox3 is correlated with nuclear localization and transcriptional regulatory activity; mutants containing deletions in the HMG box or the transactivation domain fail to induce foci of transformation. These observations suggest that Sox proteins can induce aberrant cell growth and strengthen the link of HMG proteins to oncogenesis.