We have generated transgenic mice which express an ovine beta-lactoglobulin transgene during lactation. In two transgenic lines, BLG/7 and BLG/45, beta-lactoglobulin protein levels vary between siblings, reflected at the cellular level by a mosaic transgene expression pattern in the mammary tissue that is reminiscent of position effect variegation. To investigate whether this variegating expression profile can be affected by the introduction of an identical variegating locus on the homologous chromosome, we compared the beta-lactoglobulin expression profiles in mice hemizygous or homozygous for the transgene locus. In BLG/45 mice, milk protein analysis revealed that transgene expression was effectively doubled in homozygous compared to hemizygous mice. In contrast, beta-lactoglobulin protein in hemizygous and homozygous BLG/7 mice displayed a similar range; although minimum expression levels were doubled in the homozygous population, the maximum level of expression was indistinguishable between the two populations. Fluorescent in situ hybridisation (FISH) for transgene mRNA indicated that for a given protein level, the extent of cellular expression is similar in both BLG/7 populations. In homozygous mice genomic DNA and nuclear RNA FISH demonstrated that only one of the two BLG/7 loci is active in expressing cells, while two transcription foci were present in BLG/45 homozygous mice. This mono-allelic transgene expression pattern is not inherited through the germline, as hemizygous mice bred from homozygous parents expressed at the expected hemizygous population level. We discuss these observations in the context of known epigenetic events such as imprinting and trans-inactivation.