The COMMA-D cell line derived from mammary epithelial cells of midpregnant mice was shown previously to be heterogeneous as determined by phase-contrast microscopy, immunocytochemical staining, DNA content, and oncogenic potential (K.D. Danielson et al. (1984) Proc. Natl. Acad. Sci. USA 81, 3756; D. Medina et al. (1986) J. Natl. Cancer Inst. 76, 1143). Clonal subpopulations of COMMA-D cells have now been isolated by both transfection and selection using a dominant-selectable gene transfer vector and by limiting dilution. Despite their clonal origin, these subpopulations in many cases retained the heterogeneity of the parental COMMA-D line. Of 18 clonal lines assayed, only 5 were able to express beta-casein mRNA. Pooled populations of G418-resistant cells expressed substantially higher levels of beta-casein mRNA than the clonal lines. One of the expressing clonal lines, BNW-7, was characterized further, using immunocytochemical techniques. Approximately 10% of BNW-7 cells expressed casein under the appropriate hormonal and cell-substratum conditions by indirect immunofluorescent staining. Casein immunoperoxidase staining of BNW-7 cells on floating collagen gels revealed that casein-producing cells were localized in small alveolar structures, which were formed in a non-hormone-dependent fashion. The cells in these alveolar structures were cuboidal with basally located nuclei, expressed keratin intermediate filament proteins preferentially, and comprised approximately 18% of the total cells. Cells elsewhere on the surface of the gel displayed a flattened morphology, and expressed vimentin intermediate filament proteins preferentially. A proportion of COMMA-D cells, therefore, appeared to have some of the characteristics of mammary stem cells, and retained the ability to differentiate and form phenotypically heterogeneous cell populations in vitro.