Chicken anemia virus (CAV) is an immunosuppressive pathogen of chickens. To further examine the role of viral protein 2 (VP2), which possesses dual-specificity protein phosphatase (DSP) activity, in viral cytopathogenicity and its influence on viral growth and virulence, an infectious genomic clone of CAV was subjected to site-directed mutagenesis. Substitution mutations C87R, R101G, K102D and H103Y were introduced into the DSP catalytic motif and R129G, Q131P, R/K/K150/151/152G/A/A, D/E161/162G/G, L163P, D169G and E186G into a region predicted to have a high degree of secondary structure. All mutant constructs were infectious, but their growth curves differed. The growth curve for mutant virus R/K/K150/151/152G/A/A was similar to that for wild-type virus, a second cluster of mutant viruses had an extended latent period and a third cluster of mutant viruses had extended latent and eclipse periods. All mutants had a reduced cytopathogenic effect in infected cells and VP3 was restricted to the cytoplasm. Mutation of the second basic residue (K102D) in the atypical DSP signature motif resulted in a marked reduction in virus replication efficiency, whereas mutation of the first basic residue (R101G) attenuated cytopathogenicity, but did not reduce replication efficiency. Expression of major histocompatibility complex (MHC) class I was markedly downregulated in cells infected with wild-type CAV, but not in those infected with mutants. This study further demonstrates the significance of VP2 in CAV replication and shows that specific mutations introduced into the gene encoding this protein can reduce virus replication, cytopathogenicity and downregulation of MHC I in infected cells.