Directed expression of SV40 large T antigen (TAg) in transgenic mice can induce tissue-specific tumorigenesis and useful cell lines exhibiting differentiated characteristics can be established from resultant tumor cells. In an attempt to produce an immortalised mouse hair follicle cortical cell line for the study of hair keratin gene control, SV40 TAg expression was targeted to the hair follicles of transgenic mice using a sheep hair gene promoter. Expression of SV40 TAg in the follicle cortex disrupted normal fiber ultrastructure, producing a marked phenotypic effect. Affected hairs were wavy or severely kinked (depending on the severity of the phenotype) producing an appearance ranging from a ruffled coat to a stubble covering the back of the mouse. The transgenic hairs appeared to be weakened at the base of the fibers, leading to premature hair-loss and a thinner pelage, or regions of temporary nudity. No follicle tumors or neoplasia were apparent and immortalisation of cortical cells could not be established in culture. In situ hybridisation studies in the hair follicle using histone H3 as a cell proliferation marker suggested that cell proliferation had ceased prior to commencement of K2.10-TAg expression and was not re-established in the differentiating cortical cells. Hence, TAg was unable to induce cell immortalisation at that stage of cortical cell differentiation. However, transgenic mice developed various other abnormalities including vertebral abnormalities and bladder, liver and intestinal tumors, which resulted in reduced life expectancy.R. Keough, B. Powell and G. Roger