Livers of a natural population of winter flounder from a contaminated site in Boston Harbor were examined for the presence of oncogenes by transfection of DNA into NIH 3T3 mouse fibroblasts. Tissues analyzed contained histopathologic lesions including abnormal vacuolation, biliary proliferation, and, in many cases, hepatocellular and cholangiocellular carcinomas. Fibroblasts transfected with liver DNA samples from 7 of 13 diseased animals were effective in the induction of subcutaneous sarcomas in nude mice. Further analysis revealed the presence of flounder c-Ki-ras oncogenes in all 10 nude mouse subcutaneous tumors analyzed. Direct DNA sequencing and allele-specific oligonucleotide hybridization following amplification of the tumor DNA by the polymerase chain reaction showed mutations in the 12th codon in this gene. Analysis of DNA from all nude mouse tumors as well as the livers from which they were derived showed mutations at this codon. The mutations comprised G.C----A.T or G.C----T.A base changes resulting in substitution of serine, valine, or cysteine for glycine. Liver DNA samples from five histologically normal livers of animals from a less polluted site were ineffective in the transfection assay and showed only wild-type DNA sequences (GGT) at the 12th codon of c-Ki-ras. The prevalence of mutations in this gene region was associated with the presence of liver lesions and could signify DNA damage resulting from environmental chemical exposure.