The bovine papillomavirus E5 gene encodes a 44 amino acid membrane-associated protein that can induce tumorigenic transformation of rodent fibroblast cell lines. Genetic studies suggest that the E5 protein may transform cells by influencing the activity of cellular proteins involved in growth regulation. We report here that the endogenous cellular beta type receptor for the platelet-derived growth factor (PDGF) is constitutively activated in C127 and FR3T3 cells stably transformed by the E5 protein, but not in these cell types transformed by a variety of other oncogenes. In C127 cells, a metabolic precursor as well as the mature form of the receptor is activated by E5 transformation. Activation of the receptor also occurs upon acute E5-mediated transformation of these cells and precedes mitogenic stimulation in this system. Moreover, activation of the receptor by addition of PDGF or the v-sis gene to untransformed cells is sufficient to induce DNA synthesis and stable growth transformation. We propose that the PDGF receptor is an important cellular intermediate in the transforming activity of the bovine papillomavirus E5 protein. There is a short region of sequence similarity between the fibropapillomavirus E5 proteins and PDGF, suggesting that the E5 proteins may activate the PDGF receptor by binding directly to it.