Merkel cell polyomavirus (MCV) is the recently discovered cause of most Merkel cell carcinomas (MCCs), an aggressive form of nonmelanoma skin cancer. Although MCV is known to integrate into the tumor cell genome and to undergo mutation, the molecular mechanisms used by this virus to cause cancer are unknown. Here, we show that MCV small T (sT) antigen is expressed in most MCC tumors, where it is required for tumor cell growth. Unlike the closely related SV40 sT, MCV sT transformed rodent fibroblasts to anchorage- and contact-independent growth and promoted serum-free proliferation of human cells. These effects did not involve protein phosphatase 2A (PP2A) inhibition. MCV sT was found to act downstream in the mammalian target of rapamycin (mTOR) signaling pathway to preserve eukaryotic translation initiation factor 4E–binding protein 1 (4E-BP1) hyperphosphorylation, resulting in dysregulated cap-dependent translation. MCV sT–associated 4E-BP1 serine 65 hyperphosphorylation was resistant to mTOR complex (mTORC1) and mTORC2 inhibitors. Steady-state phosphorylation of other downstream Akt-mTOR targets, including S6K and 4E-BP2, was also increased by MCV sT. Expression of a constitutively active 4E-BP1 that could not be phosphorylated antagonized the cell transformation activity of MCV sT. Taken together, these experiments showed that 4E-BP1 inhibition is required for MCV transformation. Thus, MCV sT is an oncoprotein, and its effects on dysregulated cap-dependent translation have clinical implications for the prevention, diagnosis, and treatment of MCV-related cancers.