Early theories of tumor angiogenesis suggested that preexisting vessels surrounding the tumor were the principal source of the tumor vasculature but recent evidence suggests that endothelial progenitor cells (EPC) migrate from the marrow play an important role in developing the tumor blood supply. In a mouse model, in which the vascularization of a transplantable tumor was studied after bone marrow (BM) transplantation, we show that cells that express Tie-2, Sca-1, CD31 and CD45 function as both BM EPC and primitive hematopoietic stem cells. BM cells from transgenic mice expressing green fluorescent protein (GFP) under the control of the endothelial lineage-specific Tie-2 promoter (Tie-2 /GFP) were used to reconstitute irradiated (12 Gy) wild-type mice. Five donor BM cell populations were studied: (1) whole BM; (2) Sca-1-enriched BMC; (3) GFP/Tie-2+, Sca-1+ BMC; (4) GFP/Tie-2-, Sca-1+ BMC and (5) Sca-1-depleted BMC. After 4 weeks, the mice were injected with Tg.AC tumor cells. Three weeks later, sections from the tumors were stained for CD31 and examined for Tie-2-driven GFP expression. BM-derived endothelial cells were found only in mice transplanted with bone marrow containing populations of Tie-2+, Sca-1+ cells. As few as 3500 of these cells were sufficient to radioprotect lethally irradiated mice. Thus, we conclude that a rare subset of BMC (approximately 4 x 10(-3)%) with the putative properties of hemangioblasts have an active Tie-2 promoter. Selection of Tie-2+Sca-1+ BMC enriches for marrow-derived EPCs that participate in tumor angiogenesis and cells that can provide hematopoietic reconstitution of marrow-ablated mice.