Lipoblastomas are pediatric neoplasms resulting from transformation of adipocytes. These benign tumors are typically composed of adipose cells in different stages of maturation within a variably myxoid matrix, and they contain clonal rearrangements of chromosome band 8q12. Because lipoblastomas resemble embryonic adipose tissue, characterization of their transforming mechanisms might reveal biological pathways in physiological adipogenesis. Herein, we demonstrate that lipoblastoma chromosome 8q12 rearrangements bring about promoter-swapping events in the PLAG1 oncqgene. We show that the hyaluronic acid synthase 2 (HAS2) or collagen 1 alpha 2 (COL1A2) gene promoter regions are fused to the entire PLAG1 coding sequence in each of four lipoblastomas. PLAG1 is a developmentally regulated zinc finger gene whose tumorigenic function has been shown previously only in epithelial salivary gland cells. Our findings reveal that PLAG1 activation, presumably resulting from transcriptional up-regulation, is a central oncogenic event in lipoblastoma.