Epigenetic modifications that suppress gene activity in mammals are generally considered to be cleared in the germline, restoring totipotency of the genome. Here we report the germline inheritance of transcriptional silencing in mice, and reversion to activity after as many as three generations in the silent state. In a series of lines made with a LacZ transgene, one line exhibits variable expressivity: genotypically identical littermates have proportions of beta-Gal-positive erythrocytes that vary over at least four orders of magnitude, and in some offspring expression is completely silenced. The silent state of the transgene is inherited for multiple generations in the founder strain irrespective of the sex of the parent, implying maintenance of the epigenetic state through meiosis. Crosses of silenced mice with C57BL/6 mice result in reactivation of the transgene in approximately a third of F(1) littermates. The silencing involves a stochastic, all-or-none mechanism. Furthermore, silencing is transcriptional and correlates with methylation of the transgene as well as an inaccessible chromatin structure; these changes are reversed when expression is reactivated. This work supports the notion that silent genetic information in mammals can be inherited and later reactivated, and implies a mode of phenotypic inheritance that is less stable than Mendelian inheritance.