An H7N2 subtype avian influenza virus (AIV) first appeared in the live bird marketing system (LBMS) in the Northeastern United States in 1994. Since then this lineage of virus has become the predominant subtype of AIV isolated from the LBMS and has been linked to several costly commercial poultry outbreaks. Concern for this low pathogenicity isolate mutating to the highly pathogenic form has remained high because of the increasing number of basic amino acids at the hemagglutinin (HA) cleavage site, which is known to be associated with increased pathogenicity of AIV. To address the risk of low pathogenic LBMS-lineage H7N2 virus mutating to the highly pathogenic form of the virus, we generated a series of mutant viruses that have changes in the sequence at the HA cleavage site by using plasmid-based reverse genetics. We confirmed that a conserved proline at -5 position from the HA cleavage site could be changed to a basic amino acid, producing a virus with five basic amino acids in a row at the cleavage site, but with no increase in virulence. Increased virulence was only observed when additional basic amino acids were inserted. We also observed that the virus preferred the arginine instead of lysine at the -4 position from the cleavage site to manifest increased virulence both in vitro and in vivo. Using helper virus-based reverse genetics, where only one transcription plasmid expressing a mutated HA vRNA is used, we identified specific HA cleavage site sequences that were preferentially incorporated into the low pathogenic wild-type virus. The resultant reassortant viruses were highly pathogenic in chickens. This study provides additional evidence that H7 avian influenza viruses require an insertional event to become highly pathogenic, as compared to H5 viruses that can become highly pathogenic strictly by mutation or by insertions.