Gammaherpesvirus infection is associated with an increased incidence of lymphoproliferative disease in immunocompromised hosts. Murine gammaherpesvirus 68 (γHV68) infection of BALB β2-microglobulin-deficient (BALB β2m-/-) mice provides an animal model for analysis of the mechanisms responsible for the induction of a lymphoproliferative disease, atypical lymphoid hyperplasia (ALH), that is pathologically similar to posttransplant lymphoproliferative disease associated with Epstein-Barr virus infection. Here we report that the γHV68 v-cyclin and v-bcl-2 genes are required for the efficient induction of γHV68-associated ALH in BALB β2m-/- mice, while the v-GPCR gene is dispensable for ALH induction. In contrast to these findings, deletion of the viral M1 gene enhanced ALH. Thus, γHV68 genes can either inhibit or enhance the induction of lymphoproliferative disease in immunocompromised mice.