Activation of T cells requires at least two signals: an antigen-specific signal delivered through the T-cell receptor and a costimulatory signal mediated through molecules designated B7-1 and B7-2. Previous studies have shown that introduction of B7-1 and B7-2 into tumors using retroviral vectors has led to enhanced antitumor effects. A limiting factor for potential clinical applications using this approach is the low efficiency of infection of retroviral vectors and consequent manipulations of infected cells. Vaccinia virus thus represents an alternative vector for B7 gene expression in tumor cells. In this report we describe the construction and characterization of recombinant vaccinia viruses containing the murine B7-1 and B7-2 genes (designated rV-B7-1 and rV-B7-2). Infection of BSC-1 cells with these constructs results in rapid and efficient cell surface expression of both B7-1 and B7-2 (>97% of cells at 4 h). Infection of murine carcinoma cells with low multiplicity of infection of wild-type vaccinia virus leads to the death of the host following tumor transplantation. In contrast, inoculation of rV-B7-1- or rV-B7-2-infected tumor cells into immunocompetent animals resulted in no tumor growth. These studies demonstrate the utility of recombinant vaccinia viruses to deliver B7 molecules to tumor cells for potential gene therapy and recombinant approaches to cancer immunotherapy.