Nerve growth factor (NGF) cDNA was fused to the rat prolactin promoter to induce its ectopic expression in pituitary lactotrophs of transgenic mice. High-level expression of both RNA and functional protein was achieved in two pedigrees. Pituitary cells from these animals secreted biologically active NGF that was capable of inducing rapid differentiation of cocultured PC12 pheochromocytoma cells. Despite this robust expression, transgenic pituitaries failed to show any detectable increase in neuronal innervation. Unexpectedly, we observed a dramatic hyperplasia of lactotrophs resulting in pituitaries 10-100 times larger than normal. These results suggest that NGF, in addition to its previously described effects, may act as a new class of mitogen, with a potential role in oncogenesis.