A subclone of the SV-40-transformed xeroderma pigmentosum (XP) cell line SV40XP12RO was isolated. The cell line, designated M1, is highly sensitive to UV light and is deficient in unscheduled DNA synthesis. The isoenzyme, HLA profile and karyotype of the cell line is presented. The structure and function of the resident SV40 genome was analyzed. The M1 clone contains a complete copy of the SV40 genome flanked by partial SV40-DNA copies in a head-to-tail arrangement. The large T-antigen is defective in the ability to induce SV40-DNA replication. The M1 subclone is an efficient recipient of DNA in transfection experiments. Transfection of these cell with the pSV2gpt plasmid shows that the M1 subclone is as efficient as the NIH 3T3 cell line in uptake and expression of foreign DNA. This cell line should be suitable for genetic analysis of the xeroderma pigmentosum defect. It should also be useful for the study of gene expression in human cells.