To determine the lesion development of retrovirus-induced ovine pulmonary carcinoma (OPC), ten neonatal lambs were inoculated intratracheally with either 1) lung fluid preparations derived from a sheep with Type D retrovirus-associated OPC and concurrent ovine lentivirus (OvLV)-associated lymphoid interstitial pneumonia (LIP) (n = 8); or 2) lung fluid from a sheep with only OvLV-LIP (n = 2). Seven of eight neonates that received Type D retrovirus-associated OPC/OvLV-LIP lung fluid developed both OPC and LIP lesions between 9 and 32 weeks after inoculation. Mild OPC lesions consisted of foci of type II alveolar epithelial cells lining alveoli surrounded by minimal alveolar macrophage infiltrates. More severe OPC lesions consisted of multifocal aggregates of cuboidal to columnar neoplastic cells forming acini or masses associated with abundant alveolar macrophage infiltrates. Lesions of LIP consisted of peribronchiolar and perivascular lymphoid hyperplasia and heterogeneous interstitial leukocytic infiltrates. The two neonates that received OvLV-LIP lung fluid developed rapid and severe LIP, but not OPC lesions. Two lambs (inoculated as neonates with virus-free lung fluid) and three lambs (uninoculated contacts) served as controls and did not develop OPC. To investigate age susceptibility for development of OPC, 20 additional lambs within defined age groups (neonates, 2 weeks old, 5 weeks old, and 10 weeks old) received ultracentrifuged tumor homogenate. Neonatal to 5-week-old lambs inoculated with Type D retrovirus-associated OPC/OvLV-LIP tumor homogenate were equally likely to develop OPC, but lambs inoculated at 10 weeks of age were more refractory to tumor development. These results suggest that infection of sheep by the OPC retrovirus early in life enhances susceptibility to pulmonary neoplasia and defines methods to optimize experimental reproduction of this retrovirus-induced carcinoma.