The bovine papillomavirus E5 gene encodes a 44-amino-acid, homodimeric transmembrane protein that is the smallest known transforming protein. The E5 protein transforms cultured fibroblasts by forming a stable complex with the endogenous platelet-derived growth factor (PDGF) beta receptor through transmembrane and juxtamembrane interactions, leading to sustained receptor activation. Aspartic acid 33 in the extracellular juxtamembrane region of the E5 protein is important for cell transformation and interaction with the PDGF beta receptor. A. N. Meyer et al. (Proc. Natl. Acad. Sci USA 91:4634-4638, 1994) speculated that this residue interacted with lysine 499 on the receptor. We constructed E5 mutants containing all possible substitutions at position 33, as well as several double mutants containing substitutions at aspartic acid 33 and at glutamic acid 36, and we examined the ability of these mutants to transform C127 mouse fibroblasts and to bind to and induce activation of the PDGF beta receptor. There was an excellent correlation between the transformation activities of the various mutants and their ability to bind to and activate the PDGF beta receptor. Analysis of the mutants demonstrated that a juxtamembrane negative charge on the E5 protein was required for cell transformation and for productive interaction with the PDGF beta receptor and indicated that aspartic acid 33 was more important for these activities than was glutamic acid 36. These results are consistent with the existence of an essential juxtamembrane salt bridge between lysine 499 on the PDGF beta receptor and an acidic residue in the C terminus of the E5 protein and lend support to our proposed model for the complex between the E5 dimer and the PDGF beta receptor.