The vertebrate ocular lens undergoes a spatially defined pattern of differentiation which may be regulated by the ocular distribution of proteins from the fibroblast growth factor (FGF) family. The ability of altered FGF-1 (acidic FGF) distribution to disrupt the normal pattern of lens differentiation was evaluated by the production of transgenic mice which express FGF-1 under the control of the lens-specific alpha A-crystallin promoter. Since FGF-1 lacks a classical signal peptide consensus sequence, transgenic mice were also produced with a chimeric construct containing the signal peptide sequence of the FGF-4 gene fused in frame to the coding sequences of the FGF-1 cDNA in order to obtain extracellular expression of the transgene. The presence of transgenic mRNA and protein was confirmed by in situ hybridization, Western analysis and immunohistochemistry. The ocular histology of newborn and young adult transgenic mice expressing FGF-1 without a signal peptide appeared normal. In contrast, mice expressing secreted FGF-1 exhibited lens abnormalities including the elongation of anterior epithelial cells. Epithelial cell elongation was accompanied by expression of the fiber cell differentiation marker, beta-crystallin. These observations provide an in vivo demonstration that FGF-1 can induce anterior lens epithelial cells to express characteristics consistent with the onset of fiber cell differentiation. The transgenic induction of differentiation confirms that normal lens morphology reflects an asymmetric distribution of inductive factors within the eye.