Infection by Kaposi's sarcoma (KS)-associated herpesvirus (KSHV) is a key factor in the development of KS. Both latent and lytic KSHV infection is observed in KS tumor cells, and both genetic programs contribute importantly to KS pathogenesis. The viral replication and transcription activator (RTA) protein is a transcription factor that controls the switch from latency to lytic replication. We have previously shown that RTA can activate the expression of several lytic viral genes in transfected cells by interaction with recombination signal sequence-binding protein-Jκ (RBP-Jκ, also called CSL), which in uninfected cells is a transcriptional repressor that is the target of the Notch-signaling pathway. The recognition that many KSHV lytic genes, including RTA itself, contain RBP-Jκ-binding sites raised the possibility that RBP-Jκ-mediated repression may be central to the establishment of latency. Here, we have tested this hypothesis by examining KSHV infection of RBP-Jκ-null murine fibroblasts. Our results show that KSHV latency is efficiently induced in such cells; however, the reactivation of lytic gene expression, viral DNA replication, and the release of progeny viruses are dramatically inhibited in the absence of RBP-Jκ. RBP-Jκ-mediated repression is therefore not essential for establishment of latent infection, but the RTA-mediated redirection of RBP-Jκ activity from repression to activation is critical for lytic viral replication.