Suppression subtractive hybridization was used to clone genes associated with proliferation of oval cells in rat liver regenerating after a 70% partial hepatectomy combined with the feeding of 2-acetylaminofluorene. A subset of the identified genes comprised interferon-gamma receptor alpha subunit (IFN-gammaRalpha), gp91phox, interleukin-1beta (IL-1beta), lymphocyte function-associated molecule-1alpha (LFA-1), eukaryotic initiation factor-2-associated 67-kd protein (eIF-2-associated 67-kd protein), and alpha-fetoprotein, which constitute part of the cellular program modulated by IFN-gamma. Therefore, expression analysis performed by Northern blotting and immunohistochemistry were extended to include IFN-gamma, the IFN-gamma receptor beta subunit (IFN-gammaRbeta), three secondary response genes induced by interaction of IFN-gamma with IFN-gamma receptor complexes, ie, IL-1beta-converting enzyme (ICE), intercellular adhesion molecule-1 (ICAM-1), and urokinase-type plasminogen activator receptor (uPAR), and a cytokine inducing IFN-gamma expression, ie, interleukin-18 (IL-18). The Northern blot analysis showed that all examined genes were modulated when progenitor-like oval cells were activated and recruited for liver regeneration. Immunohistochemistry localized the subunits of the IFN-gamma receptor complex, IFN-gammaRalpha and IFN-gammaRbeta, the secondary response genes uPAR and ICAM-1, the IFN-gamma-inducing factor IL-18, and ICE to the ductular structures of oval cells. In contrast, during liver regeneration after a 70% partial hepatectomy, only modulation of IL-1beta and ICE was observed. Our results, therefore, indicate that IFN-gamma-mediated events may be particularly important when cells in the bile ductules must respond to liver damage by production of ductular oval cells.