MUC1, a membrane tethered mucin glycoprotein, is overexpressed and aberrantly glycosylated in >80% of human ductal pancreatic adenocarcinoma. However, the role of MUC1 in pancreatic cancer has been elusive, partly due to the lack of an appropriate model. We report the characterization of a novel mouse model that expresses human MUC1 as a self molecule (PDA.MUC1 mice). Pancreatic tumors arise in an appropriate MUC1-tolerant background within an immune-competent host. Significant enhancement in the development of pancreatic intraepithelial preneoplastic lesions and progression to adenocarcinoma is observed in PDA.MUC1 mice, possibly due to increased proliferation. Tumors from PDA.MUC1 mice express higher levels of cyclooxygenase-2 and IDO compared with PDA mice lacking MUC1, especially during early stages of tumor development. The increased proinflammatory milieu correlates with an increased percentage of regulatory T cells and myeloid suppressor cells in the pancreatic tumor and tumor draining lymph nodes. Data shows that during pancreatic cancer progression, MUC1-mediated mechanisms enhance the onset and progression of the disease, which in turn regulate the immune responses. Thus, the mouse model is ideally suited for testing novel chemopreventive and therapeutic strategies against pancreatic cancer.