E type cyclins (E1 and E2) are believed to drive cell entry into the S phase. It is widely assumed that the two E type cyclins are critically required for proliferation of all cell types. Here, we demonstrate that E type cyclins are largely dispensable for mouse development. However, endoreplication of trophoblast giant cells and megakaryocytes is severely impaired in the absence of cyclin E. Cyclin E-deficient cells proliferate actively under conditions of continuous cell cycling but are unable to reenter the cell cycle from the quiescent G(0) state. Molecular analyses revealed that cells lacking cyclin E fail to normally incorporate MCM proteins into DNA replication origins during G(0)-->S progression. We also found that cyclin E-deficient cells are relatively resistant to oncogenic transformation. These findings define a molecular function for E type cyclins in cell cycle reentry and reveal a differential requirement for cyclin E in normal versus oncogenic proliferation.