Mouse liver cell lines that bear a stably integrated lactose operon repressor (lacI) gene and a Ha-ras gene linked to a lactose operator-containing SV40 early promoter were generated. When grown in medium containing more than 0.1 mM isopropyl beta-D-thiogalactoside (IPTG), the Ha-ras gene was induced up to 20-fold. Maximum induction of Ha-ras gene expression occurred after 12 h of exposure. The tumorigenicity of these cell lines in syngeneic mice was enhanced when the mice were maintained on drinking water containing 12.5 mM IPTG. Ha-ras gene expression in tumors was strongly induced in the presence of IPTG in vivo. Induction of Ha-ras gene expression in mice was consistently observed after 48 hr of exposure to drinking water containing IPTG. This system provides an approach for studying the function of oncogene in vivo as well as other genes of interest.