Epstein-Barr virus (EBV) is closely associated with several malignancies, including nasopharyngeal carcinoma. To investigate the EBV activity in tumor development, we tried to establish a malignant model of EBV-infected cells in nude mice. On the basis of the Maxi-EBV system, a human embryonic kidney epithelial cell line (293) with a low malignant potential was used for a stable EBV genome infection. The derived cell line, termed 293-EBV, exhibited obvious morphological transformation and significantly increased growth ability, with the cell cycle redistributed. The clonability and tumorigenicity were also substantially accelerated. In 293-EBV cells, the expression level of the transcription factor NF-kappaB and JNK2 were upregulated. The result suggested that latent membrane protein 1 (LMP1) was an important viral protein responsible for the enhanced malignant potential. Matured and budding virus particles were observed in tumor tissues, confirming the spontaneous reactivation of EBV from latent genome to lytic cycle at the site of tumor development. Primary culture of tumor tissues showed two patterns about the EBV maintenance or not in newly grown cells, and this was dependent on the thickness of the planted tissues. Moreover, the tumor cells lost EBV genome easily when subcultured at low density. Our findings revealed the cell-to-cell contact mechanism, which was required for the EBV maintenance in the tumor cells during the expansion of EBV-infected cells. This mechanism might give an explanation to the phenomenon that EBV genome in epithelial tumor cells becomes easily lost during subculture in vitro. Our results provided further evidence of a function for EBV in the etiology of tumor development.