The initiation site for translation of the avian sarcoma virus glycoprotein precursor, Pr63env, has been determined by analyzing the amino-terminal peptides of Pr63env and the polyprotein precursor Pr76gag encoded by the viral gag gene. The acceptor splice junction used to form the env gene mRNA has also been identified. Hybrid-selected virus-specific mRNAs were translated in vitro in the presence of either L-[35S]methionine to label at every methionine residue or L-[35S]methionine-tRNAMeti to label specifically at the amino-terminal methionine residues. Tryptic peptide maps of Pr63env labeled at every methionine residue contain all of the peptides, plus one additional peptide, present in the map of Pr57env, a nonglycosylated env-encoded polypeptide of molecular weight 57,000 immunoprecipitated from tunicamycin-treated cells. Specific amino-terminal labeling of the in vitro-synthesized polypeptides showed that the peptide missing from Pr57env corresponds to the amino-terminal tryptic peptide of Pr63env, which is removed in vivo as part of the amino-terminal signal peptide. Comparison of the amino-terminal tryptic peptides of Pr63env and Pr76gag showed that they are identical. In contrast, the chymotryptic amino-terminal peptides of Pr76gag and Pr63env are not identical. The location of the acceptor-splice junction in the env mRNA of the Prague A strain of avian sarcoma virus was determined by mung bean nuclease mapping to be at nucleotide 5,078. Fusion of the gag and env gene sequences during splicing results in use of the same AUG codon to initiate synthesis of Pr76gag and Pr63env. This sequence is contained within the 397-nucleotide 5' terminal leader that is spliced to the body of the env mRNA. The possible significance of these results for the regulation of avian sarcoma virus synthesis and translation is discussed.