The latent membrane protein 1 (LMP1) of Epstein-Barr virus (EBV) causes cellular transformation and activation of several intracellular signaling events. In this report, we show that BLMP1 (encoded by the LMP1 gene derived from the B95-8 strain of EBV) triggers the expression of inducible nitric oxide synthase (iNOS) in Balb/3T3 fibroblasts. Intriguingly, NLMP1, a natural sequence variant of LMP1 identified in EBV-positive nasopharyngeal carcinoma biopsy, does not similarly induce iNOS expression. BLMP1-induced iNOS in Balb/3T3 cells is active to produce nitric oxide (NO), and NO production can be blocked by several iNOS inhibitors. When subjected to environmental stress, Balb/3T3 cells that produce NO lose viability more rapidly than non NO-producing cells. Blockage of NO generation by iNOS inhibitors enhances the viability of NO-producing cells under stress conditions. The activities of caspase-3 and c-Jun N-terminal kinase, two important regulators mediating stress-induced apoptosis, are significantly potentiated following heat shock treatment of BLMP1-expressing/NO-producing cells, compared to parental and NLMP1-expressing cells. Furthermore, treatment with iNOS inhibitor augmented the cloning efficiency (in culture) and tumor growth (in nude mice) of BLMP1-expressing/NO-producing cells. Collectively, the results demonstrate that BLMP1 induces iNOS expression and NO production in Balb/3T3 cells, which leads to the alteration of cell functions, including sensitivity to environmental stress, capability to colonize independent of anchorage and tumorigenicity in nude mice. Our data additionally implicate that the differential iNOS induction potential of the two LMP1 forms may represent the basis of a functional difference between the two LMP1 proteins.