Mink cell cultures infected with the Snyder-Theilen strain of feline sarcoma-leukemia virus were cloned from single cells under conditions favoring single virus-single cell interactions. The primary colonies included (i) typical feline sarcoma virus (FeSV)-transformed nonproducer clones, one of which segregated revertants, and (ii) FeSV-infected, phenotypically normal clones, three of which spontaneously converted to the transformed phenotype. The revertants and spontaneous transformants were compared with parental and sister clones expressing the opposite phenotype. Transformed subclones formed colonies in agar, were tumorigenic in nude mice, and failed to bind epidermal growth factor, whereas flat sister subclones were indistinguishable from uninfected mink cells in each of these assays. Sister subclones derived from the same infectious event contained FeSV proviruses integrated at the same molecular site, regardless of which phenotype was expressed. One revertant clone, however, lacked most FeSV proviral DNA sequences but retained terminal portions of the FeSV genome which persisted at the original site of proviral DNA insertion. Two flat subclones expressed viral RNA and the phosphorylated "gag-x" polyprotein (pp78gag-x) encoded by the gag and src sequences of the FeSV genome. Both of these clones were susceptible to retransformation by FeSV. Although unable to induce foci, the viruses rescued from these cells contained as much FeSV RNA as the focus-forming viruses rescued from transformed sister subclones and could be retransmitted to mink cells, again inducing FeSV gene products without signs of morphological transformation. We conclude that these FeSV genomes represent transformation-defective mutants.