Wild-type transforming growth factor alpha (TGFalpha) expression in lactotrope cells in the pituitary gland led to lactotrope-specific pituitary hyperplasia and adenomata. To indicate whether the EGF receptor is involved in this TGFalpha-mediated phenotype, we bred TGFalpha mice with mice expressing the cytoplasmic truncated-EGF receptor (EGFR-tr), which is dominant-negative in other models. These bitransgenic mice developed pituitary pathology despite expression of the dominant-negative receptor. To further characterize this observation, we generated two lineages of transgenic mice that overexpress mutant forms of TGFalpha: a processed soluble form (s TGFalpha) and a cytoplasmic-deleted form (TGFalphaDeltaC). While sTGFalpha expression in lactotrope cells failed to induce autocrine lactotrope hyperplasia, the pituitary became very enlarged due to proliferation of neighboring interstitial cells. In contrast, the TGFalphaDeltaC mice did not develop a phenotype, although the mRNA and protein were present in the pituitary and this form of TGFalpha was confirmed to be biologically active and targeted properly to the plasma membrane of cultured CHO cells. The results suggest that the cytoplasmic domain of TGFalpha is required for autocrine parenchymal tumor formation in the pituitary gland. This signal cannot be inhibited by the EGFR-tr. Conversely, the released form of TGFalpha appears to have primarily paracrine activity.