The Sleeping Beauty (SB) transposon system has been used as a somatic mutagen to identify candidate cancer genes. In previous studies, efficient leukemia/lymphoma formation on an otherwise wild-type genetic background occurred in mice undergoing whole-body mobilization of transposons, but was accompanied by high levels of embryonic lethality. To explore the utility of SB for large-scale cancer gene discovery projects, we have generated mice that carry combinations of different transposon and transposase transgenes. We have identified a transposon/transposase combination that promotes highly penetrant leukemia/lymphoma formation on an otherwise wild-type genetic background, yet does not cause embryonic lethality. Infiltrating gliomas also occurred at lower penetrance in these mice. SB-induced or accelerated tumors do not harbor large numbers of chromosomal amplifications or deletions, indicating that transposon mobilization likely promotes tumor formation by insertional mutagenesis of cancer genes, and not by promoting wide-scale genomic instability. Cloning of transposon insertions from lymphomas/ leukemias identified common insertion sites at known and candidate novel cancer genes. These data indicate that a high mutagenesis rate can be achieved using SB without high levels of embryonic lethality or genomic instability. Furthermore, the SB system could be used to identify new genes involved in lymphomagenesis/leukemogenesis.