In order to define bovine leukemia virus (BLV) sequences required for efficient vector replication, a series of mutations were made in a BLV vector. Testing the replication efficiency of the vectors with a helper virus and helper plasmids allowed for separation of the mutant vectors into three groups. The replication efficiency of the first group was reduced by a factor of 7; these mutants contained deletions in the 5' end of the gag gene. The second group of mutants had replication reduced by a factor of 50 and had deletions including the 5' untranslated leader region. The third group of mutants replicated at levels comparable to those of the parental vector and contained deletions of the 3' end of the gag gene, the pol gene, and the env gene. Analysis of cytoplasmic and virion RNA levels indicated that vector RNA expression was not affected but that the vector RNA encapsidation was less efficient for group 1 and group 2 mutants. Additional mutations revealed two regions important for RNA encapsidation. The first region is a 132- nucleotide-base sequence within the gag gene (nucleotides 1015 to 1147 of the proviral DNA) and facilitates efficient RNA encapsidation in the presence of the second region. The second region includes a 147-nucleotide-base sequence downstream of the primer binding site (nucleotide 551) and near the gag gene start codon (nucleotide 698; gag begins at nucleotide 628) and is essential for RNA encapsidation. We conclude that the encapsidation signal is discontinuous; a primary signal, essential for RNA encapsidation, is largely in the untranslated leader region between the primer binding site and near the gag start codon. A secondary signal, which facilitates efficient RNA encapsidation, is in a 132-nucleotide-base region within the 5' end of the gag gene.