In this study we examined the regulation of expression of the human MUC1 gene in vivo, by developing MUC1 transgenic mice. The data showed that epithelial-specific expression of MUC1 can be directed by just 1.4 kb of 5' flanking sequence using MUC1 cDNA as a reporter gene in vivo. Furthermore, high levels of MUC1 expression were seen in the lactating mammary gland and in spontaneous mammary tumors generated by crossing the MUC1 transgenics with mice transgenic for the polyoma middle T oncogene under the control of the mouse mammary tumor virus promoter. This pattern of expression in epithelial tissues is comparable to the expression of MUC1 in humans and also to the expression pattern in another transgenic mouse line developed with a 10.6-kb genomic MUC1 fragment. This study confirmed that MUC1 is a compact gene and demonstrated that the 1.4-kb 5' sequence not only directs epithelial-specific expression of MUC1 in vivo but also contains the elements governing the up-regulation observed during lactation and in malignancy.