Activins are TGFbeta family members known to mediate a variety of developmental events. We examined the effects of activins on the self-renewing epithelial lineages present in gastric units of the adult mouse stomach. These lineages are descended from multipotent stem cells located in the midportion of each unit. The stem cell and its immediate descendants can be identified by their morphological features. Studies of knockout mice lacking activins A or B, and/or activin type II receptors (ActRII) revealed that ActRII-mediated signaling is not required for normal gastric epithelial morphogenesis or homeostasis. Mice homozygous for a null allele of the alpha-inhibin gene (inha[m1/m1]) develop gonadal sex cord stromal tumors that secrete large amounts of activins A and B. Analysis of inha(m1/m1) mice, with or without gonads, established that supraphysiological levels of activins block differentiation of preparietal to acid-producing parietal cells, differentiation of neck cells to pepsinogen-producing zymogenic cells, and terminal differentiation of mucus-producing pit cells. ActRII mRNA is normally present in pit, parietal, and zymogenic cells. inha(m1/m1)actRII(m1/m1) compound homozygotes develop activin-secreting gonadal tumors but have no abnormalities in their gastric epithelium, indicating that persistent stimulation of ActRII-dependent signaling pathways produces pleiotrophic effects on gastric epithelial differentiation. When a lineage-specific promoter is used to ablate mature parietal cells with an attenuated diphtheria toxin A fragment in transgenic mice, there is increased proliferation of the multipotent gastric stem cell and its committed daughters and subsequent development of gastric neoplasia. Parietal cell loss in inha(m1/m1) mice is not associated with this proliferative response. These different responses to parietal cell loss suggest that stimulation of ActRII-dependent signaling pathways in inha(m1/m1) animals affects the proliferative activity of the stem cell and its immediate descendents. This finding may have therapeutic significance.