Polyoma virus host range transforming (hr-t) mutants are blocked in virion assembly. In normal 3T3 cells, a nonpermissive host, these mutants synthesize 30-40% as much viral DNA and 80-100% as much capsid proteins as does wild-type virus and yet produce only 1-2% as much infectious virus. Intermediates in virion assembly have been followed by [3H]thymidine incorporation. hr-t mutants synthesize 95S replicating minichromosomes, which accumulate as 75S forms. However, the latter fail to undergo efficient transition to 240S virion structures. This block in encapsidation is overcome in permissive hosts such as primary baby mouse kidney (BMK) epithelial cells. The block in assembly of 240S particles is accompanied by a failure to induce a series of acidic isoelectric forms of the major capsid protein, VP1. Multiple species of post-translationally modified VP1 are seen by two-dimensional gel electrophoresis in wild-type virus-infected cells. These acidic VP1 subspecies are decreased 6- to 10-fold in hr-t mutant-infected 3T3 cells but are produced in normal amounts when the same mutants infect BMK cells. When 3T3 cells are coinfected with hr-t mutant and wild-type viruses, normal amounts of the VP1 subspecies are present, and hr-t mutant viral DNA is efficiently packaged into virions. These studies demonstrate an important role of the hr-t gene of polyoma virus in virus assembly. Specifically, we propose that VP1 is a target for hr-t gene-controlled modification and that modified forms of VP1 are essential for encapsidation of viral minichromosomes.