The oncogenic transcription factor E2a-Pbx1 is expressed in some cases of acute lymphoblastic leukemia as a result of chromosomal translocation 1;19. The early observation that E2a-Pbx1 incorporates transcriptional activation domains from E2a and a DNA-binding homeodomain from Pbx1 inspired a model in which E2a-Pbx1 promotes leukemogenic transformation of lymphoid progenitor cells through transcriptional induction of target genes defined by the Pbx1 portion of the molecule. However, the subsequent demonstration that the only known DNA-binding module on the molecule, the Pbx1 homeodomain, is dispensable for the induction of lymphoblastic lymphoma in transgenic mice called into question the contribution made by the Pbx1 portion. In this study, we have used a domain swap approach coupled with a fibroblast-based focus formation assay to evaluate further the requirement for PBX1-encoded peptide elements in growth deregulation by E2a-Pbx1. No impairment of focus formation was observed when the entire Pbx1 portion was replaced with DNA-binding/dimerization domains derived from yeast transcription factor GAL4 or GCN4. Furthermore, replacement of Pbx1 with tandem FKBP domains that mediate homodimerization in the presence of a synthetic ligand led to striking growth deregulation exclusively in the presence of the dimerizing agent. N-terminal elements encoded by E2A, including the AD1 transcriptional activation domain, were required for dimerization-induced focus formation. We conclude that transcriptional target genes defined by heterologous C-terminal DNA-binding modules are not required in growth deregulation by E2a fusion proteins. We speculate that interactions between N-terminal E2a elements and undefined proteins that could function as components of a transcriptional coactivator complex may be more important.