Vaccinia virus has two copies of a gene which has amino acid sequence homology with the receptor binding site of epidermal growth factor (EGF) and transforming growth factor (TGF-alpha). A 25 Kilodalton glycoprotein (vaccinia virus growth factor (VGF) that can bind to EGF receptors) has been purified from media of virus infected BS-C-1 cells. When a mutant virus (VGF-) was constructed by removing both copies of the sequence encoding the putative EGF receptor binding site, the EGF receptor binding activity in infected cells was abolished. Inoculations of the VGF- mutant into BALB/cByJ mice by the intracranial route resulted in an LD50 which was 100-fold higher than the wild-type (WT) virus. A similar attenuated phenotype was observed with the mutant on intradermal inoculation of the skin of a New Zealand white rabbit. Both WT and VGF- mutant virus infected with similar efficiencies BS-C-1, A431 and Swiss 3T3 cell monolayers, even though the density of EGF receptors varied considerably among the cell lines. It was also shown that an anti-EGF receptor MAB 528 reduced the plaquing efficiency of both WT and VGF- mutant virus on A431 cell monolayers only slightly and to the same extent. These data support the notion that VFG binding to the EGF receptor is not required for virus entry into host cells. Using non-proliferating, Swiss 3T3 cells, WT virus was shown to replicate more efficiently than VGF-mutant, and suggested a role for VGF in the enhancement of virus replication under conditions which did not support cell growth. On the CAM of the egg, both WT and mutant virus formed pocks with approximately the same efficiency. The WT, but not the mutant, induced extensive ectoderm and endoderm proliferation. The proliferating cells were shown to be initially uninfected. WT lesions were on the whole slightly larger than the mutant, and contained greater amounts of infectivity and antigen. Both viruses induced a similar inflammatory response in the host which was observed at 40 hours post inoculation. These results show that in vivo VGF can induce non-dividing cells to proliferate dramatically which increases the rate of virus replication and spread within the lesion.