A unique, spontaneously immortalized rat pulmonary endothelial cell line was transfected with a human growth hormone (hGH) fusion gene generating a line of stably transfected cells that expresses high levels of hGH (Ec/XGH-1). These cells produced significant serum levels of hGH when implanted intraperitoneally, subcutaneously, or intravenously into nude mice. Implantation of Ec/XGH-1 cells under the renal capsule resulted in the formation of large cysts that contained concentrations of hGH that were several thousand times greater than those in serum assayed simultaneously from the same animals. This study presents a new technique for in vivo gene expression using a convenient line of pulmonary vascular endothelial cells as gene carriers. In addition, this system demonstrates the special physiological features of transfected endothelial cells in forming large cysts.