The t(11;22)(q24;q12) translocation is present in up to 95% of cases of Ewing's sarcoma and results in the formation of an EWS-FLI1 fusion gene which encodes a chimeric transcription factor. The proximate role of EWS-FLI1 in the pathogenesis of Ewing's sarcoma is thought to involve the activation of as yet largely unknown target genes. Many alternative forms of EWS-FLI1 exist because of variations in the locations of the EWS and FLI1 genomic breakpoints. The most common form, designated "type 1," consists of the first seven exons of EWS joined to exons 6-9 of FLI1 and accounts for approximately 60% of cases. The "type 2" EWS-FLI1 fusion also includes FLI1 exon 5 and is present in another 25%. We and others have observed previously that the type 1 fusion is associated with a significantly better prognosis than the other fusion types. Because EWS-FLI1 is an aberrant transcription factor, we investigated whether these differences in clinical behavior may be correlated to functional differences by comparing transactivation by the type 1 EWS-FLI1 with other types in both heterologous cells (HeLa, NIH3T3) and homologous cells (Ewing's sarcoma cell lines). In a panel of seven Ewing's sarcoma cell lines, we found transactivation of a transiently transfected FLI1-responsive reporter construct to be significantly lower in cell lines with the type 1 fusion than in cell lines with the type 2 fusion (P = 0.003). Cotransfection of the same reporter construct with each of a series of seven EWS-FLI1 expression constructs (corresponding to the two major fusion types and five less common types) also showed that type 1 EWS-FLI1 was a significantly weaker transactivator than the type 2 product in both HeLa and NIH3T3 cells (P = 0.003, and P = 0.033, respectively). Electromobility shift assays showed equivalent binding of the type 1 and type 2 EWS-FLI1 to the consensus FLI1-responsive binding site, indicating that differences in transactivation were not due simply to differences in DNA binding affinity. The finding that the type 1 EWS-FLI1 fusion, associated with less aggressive clinical behavior, encodes a less active chimeric transcription factor may provide the basis for a molecular explanation of clinical heterogeneity in Ewing's sarcoma.