Publisher This chapter deals with recent studies on the biological activity of viral DNA, with emphasis on the studies dealing with cell transformation. It describes commonly used techniques for assaying biological activity of purified viral DNA and discusses the development of these assays and their mechanism of action. The chapter also reviews some studies in which these assays are used to probe the structure and function of tumor virus DNA. Most commonly observed transformations are changes in morphology, changes in growth properties, changes in metabolic requirements, and in karyotype. Oncogenic transformation is an event that alters cells in such a way that, after inoculation into a suitable host, they can grow to form a tumor. Four of the six commonly known groups of DNA viruses are known to induce tumors either in their natural host or under certain laboratory conditions. Among these, Polyoma and SV40 are the most intensively studied and best characterized DNA tumor viruses. One certain conclusion from studies on transformation states that the fragments of viral DNA of less than genome size can transform cultured cells or even induce tumors in animals.