Urothelial tumors develop along two distinctive phenotypic pathways (superficial papillary non-invasive tumors versus flat carcinoma in situ lesions), with markedly different biological behavior and prognosis. Although multiple genetic alterations have been identified in human bladder cancer, their cause-effect relationship with the two pathways has not been firmly established. Using a urothelium-specific promoter of the uroplakin II gene, we showed earlier in transgenic mice that the urothelial expression of SV40T antigen, which inactivates p53 and pRb, induced carcinoma in situ and invasive and metastatic bladder cancer. In striking contrast, we demonstrate here that the urothelial expression of an activated Ha-ras in transgenic mice caused urothelial hyperplasia and superficial papillary non-invasive bladder tumors. These results provide strong, direct experimental evidence that the two phenotypical pathways of bladder tumorigenesis are caused by distinctive genetic defects. Our results indicate that Ha-ras activation can induce urothelial proliferation in vivo; and that urothelial hyperplasia is a precursor of low-grade, superficial papillary bladder tumors. Our transgenic models provide unique opportunities to study the detailed molecular events underlying different types of bladder neoplasms, and can serve as useful preclinical models for evaluating the in vivo efficacy of preventive and therapeutic agents that act on various signaling pathways in bladder cancer.