Groups Geom. Dyn. 4 (2010), 873–900 DOI 10.4171/GGD/112 Groups, Geometry, and Dynamics © European Mathematical Society Nil graded self-similar algebras Victor M. Petrogradsky 1 , Ivan P. Shestakov 2 and Efim Zelmanov 3 Abstract. In [19], [24] we introduced a family of self-similar nil Lie algebras L over fields of prime characteristic p>0 whose properties resemble those of Grigorchuk and Gupta–Sidki groups. The Lie algebra L is generated by two derivations v 1 D @ 1 C t p1 0 .@ 2 C t p1 1 .@ 3 C t p1 2 .@ 4 C t p1 3 .@ 5 C t p1 4 .@ 6 C /////; v 2 D @ 2 C t p1 1 .@ 3 C t p1 2 .@ 4 C t p1 3 .@ 5 C t p1 4 .@ 6 C //// of the truncated polynomial ring KŒt i ;i 2 N j t p i D 0;i 2 Nin countably many variables. The associative algebra A generated by v 1 , v 2 is equipped with a natural Z ˚ Z-gradation. In this paper we show that for p, which is not representable as p D m 2 C m C 1, m 2 Z, the algebra A is graded nil and can be represented as a sum of two locally nilpotent subalgebras. L. Bartholdi [3] and Ya. S. Krylyuk [15] proved that for p D m 2 C m C 1 the algebra A is not graded nil. However, we show that the second family of self-similar Lie algebras introduced in [24] and their associative hulls are always Z p -graded, graded nil, and are sums of two locally nilpotent subalgebras. Mathematics Subject Classication (2010). 17B05, 17B50, 17B66, 17B65, 16P90, 11B39. Keywords. Modular Lie algebras, growth, nil-algebras, self-similar, Gelfand–Kirillov dimen- sion, Lie algebras of vector fields, Grigorchuk group, Gupta–Sidki group. 1. Denitions and constructions Let L be a Lie algebra over a field K of characteristic p>0 and let ad x W L ! L, ad x.y/ D Œx;y for x;y 2 L, be the adjoint map. Recall that L is called a restricted Lie algebra or Lie p-algebra [12], [26], [1] if L additionally affords a unary operation x 7! x Œp , x 2 L, satisfying i) .x/ Œp D p x Œp for all 2 K, x 2 L; ii) ad.x Œp / D .ad x/ p for all x 2 L; 1 The first author was partially supported by grants FAPESP 05/58376-0 and RFBR-07-01-00080. 2 The second author was partially supported by grants FAPESP 05/60337-2 and CNPq 304991/2006-6. 3 The third author was partially supported by the NSF grant DMS-0758487.