Myxoma virus (MV) is a highly lethal, rabbit-specific poxvirus that induces a disease called myxomatosis in European rabbits. In an effort to understand the function of predicted immunomodulatory genes we have deleted various viral genes from MV and tested the ability of these knockout viruses to induce lethal myxomatosis. MV encodes a unique 15 kD cytoplasmic protein (M130R) that is expressed late (12h post infection) during infection. M130R is a non-essential gene for MV replication in rabbit, monkey or human cell lines. Construction of a targeted gene knockout virus (vMyx130KO) and infection of susceptible rabbits demonstrate that the M130R knockout virus is attenuated and that loss of M130R expression allows the rabbit host immune system to effectively respond to and control the lethal effects of MV. M130R expression is a bona fide poxviral virulence factor necessary for full and lethal development of myxomatosis.