Previous studies have indicated that Bcl-3 interacts through its ankyrin repeats with the transcriptional factors NF-κB1 (p50) and NF-κB2 (p52), affecting their biological activities. To further investigate the role of Bcl-3 in vivo and its association with the NF-κB proteins, we have generated transgenic mice constitutively expressing Bcl-3 in thymocytes. The results indicate that Bcl-3 is associated with endogenous p50 and p52 in nuclear extracts from transgenic animals. Remarkably, constitutive expression of Bcl-3 in these cells augments the DNA binding activity of endogenous p50 homodimers more than 10-fold but does not significantly increase the activity of p52 homodimers. This effect could be reproduced in vitro and is blocked by anti-Bcl-3 antibodies. We have also shown that Bcl-3 is phosphorylated in thymocytes and that its dephosphorylation greatly decreases the effect on p50 homodimers.