Infection of 10-day-old chicken embryos with an avian retrovirus. Rous-associated virus type 7, resulted in a disease characterized by stunting and hyperlipidemia. By 20 days after hatch, infected chickens were smaller than hatchmates and developed ataxia and obesity over the next 30 days. Histological examinations of livers from infected chickens revealed a diffuse panlobular fatty infiltrate involving an accumulation of fat in microdroplets. Electron microscopic examinations of livers from infected chickens revealed hepatocytes with swollen mitochondria that lacked cristae. The thyroid and pancreas were infiltrated with lymphoblastoid cells by 1 week after hatch. An examination of the blood revealed a mild anemia, a frank lipemia, and high levels of uric acid. This syndrome induced by Rous-associated virus type 7 in chickens may be useful for elucidating the nature of several diseases, including that found in the fatty liver and kidney syndrome of chickens and that observed in a strain of obese chickens.