The kinetics of solitary mammary tumor formation in transgenic mice bearing the MMTV-int-2 (fgf3) fusion gene suggest that several genetic events are required for tumorigenesis. In an effort to identify elements that could contribute to this oncogenic process, we used differential display PCR to identify gene products that are strongly and specifically induced in int-2 mammary tumors. Using this approach we identified a member of the FGF family, kgf (fgf7), as a gene that is strongly upregulated in an int-2-containing mammary tumor. Since int-2 and kgf strongly bind the same receptor, the IIIb isoform of FGFR2, it is possible that their joint expression, one as a transgene, the other as an activated gene, might reinforce the same mitogenic pathway. To test this possibility, we created transgenic mice that carry kgf as a transgene gene under the control of the MMTV promoter/enhancer. Female mice carrying this transgene develop a very dramatic mammary epithelial hyperplasia and go on to develop solitary, metastatic adenocarcinomas of the mammary gland. Consistent with a common signalling pathway, the MMTV-kgf-induced hyperplasia has the morphologic characteristics of that seen in the MMTV-int-2 mice. Male mice also develop hyperplasia of the male genital tract, including the seminal vesicle, the vas deferens and the prostate. Thus KGF can act as a potent proliferative inducer in mammary and specific urogenital tissue and can contribute to the development of adenocarcinoma of the mammary gland in a manner strongly reminiscent of receptor-related ligand, int-2.