The proto-oncogenemychas been intensively studied primarily in vertebrate cell culture systems. Myc transcription factors control fundamental cellular processes such as cell proliferation, cell cycle control and stem cell maintenance. Myc interacts with the Max protein and Myc/Max heterodimers regulate thousands of target genes. The genome of the freshwater polypHydraencodes fourmycgenes (myc1-4). Previous structural and biochemical characterization showed that theHydraMyc1 and Myc2 proteins share high similarities with vertebrate c-Myc, and their expression patterns suggested a function in adult stem cell maintenance. In contrast, an additionalHydraMyc protein termed Myc3 is highly divergent, lacking the common N-terminal domain and all conserved Myc-boxes. Single cell transcriptome analysis revealed that themyc3gene is expressed in a distinct population of interstitial precursor cells committed to nerve- and gland-cell differentiation, where the Myc3 protein may counteract the stemness actions of Myc1 and Myc2 and thereby allow the implementation of a differentiation program. In vitro DNA binding studies showed that Myc3 dimerizes withHydraMax, and this dimer efficiently binds to DNA containing the canonical Myc consensus motif (E-box). In vivo cell transformation assays in avian fibroblast cultures further revealed an unexpected high potential for oncogenic transformation in the conserved Myc3 C-terminus, as compared toHydraMyc2 or Myc1. Structure modeling of the Myc3 protein predicted conserved amino acid residues in its bHLH-LZ domain engaged in Myc3/Max dimerization. Mutating these amino acid residues in the human c-Myc (MYC) sequence resulted in a significant decrease in its cell transformation potential. We discuss our findings in the context of oncogenic transformation and cell differentiation, both relevant for human cancer, where Myc represents a major driver.