Kaposi sarcoma (KS) is associated with KS-associated herpesvirus (KSHV). This virus also causes B-cell lymphoma and B-cell hyperplasia. There exists no in vivo model for KSHV-associated B-cell malignancies or premalignant persistence in B cells. We generated a transgenic mouse that expresses multiple viral latent genes, including LANA, vFLIP, vCYC, all viral micro RNAs, and kaposin under the transcriptional control of their natural regulatory region. This promoter is B-cell specific, though it is a weak promoter. Mature B cells were chronically activated, leading to hyperglobulinemia triggered by increased plasma cell frequency and marginal zone (MZ) B-cell hyperplasia. The mice had an augmented response to T-dependent antigen as well as the TLR4 ligand LPS, leading to exacerbated MZ and germinal center responses and increased CD138(+) plasma cells. It is the first model to assess the viral micro RNA function in vivo. These data support a potentially novel mechanism of viral persistence in which virally infected B cells become hyper-responsive to coincident, but unrelated, pathogen exposure, leading to preferential expansion and ultimately lymphoma in a small subset of cases.