The late stages of the erythroleukemias induced by either the replication-defective Friend spleen focus-forming virus (SFFV) or the Friend murine leukemia virus (F-MuLV) are associated with the insertional activation of one of two members (Spi-1 or Fli-1) of the Ets protooncogene family of transcriptional factors. Fli-1 is not rearranged or activated in the erythroleukemias induced by SFFV, and similarly Spi-1 is not rearranged or activated in the leukemic cell clones induced by F-MuLV. This strict specificity of integration sites suggests that Fli-1 and Spi-1 may be functionally distinct and transactivate different downstream genes during the progression of multistage Friend erythroleukemia. In this study, we show that the Fli-1 protein, like other Ets proteins, has DNA-binding activity and can act as a sequence-specific transcriptional activator. We also show that the Fli-1 and Spi-1 proteins are functionally distinct in that they recognize and transactivate through distinct DNA binding sites. Furthermore, we have identified an octanucleotide core sequence that is required in vitro for optimal binding of Fli-1 to the Drosophila E74 target and the promoter sequence of the human GPIIB gene.