L eukemia inhibitory factor (LIF) and LIF receptors are expressed in adenohypophyseal cells and LIF regulates pituitary hormone transcription and cell replication in vitro. Therefore, transgenic mice expressing pituitary-directed LIF driven by the rat growth hormone (GH) promoter were generated to evaluate the impact of LIF on pituitary development. Three founders were established with diminished linear growth and body weight (57-65% of wild type [WT]), and intense anterior pituitary LIF immunoreactivity. Cystic cavities observed in pituitary anterior lobes were lined by cuboidal, ciliated epithelial cells, focally immunopositive for cytokeratin and S-100 protein and immunonegative for adenohypophyseal hormones. Transgenic pituitaries showed decreased GH (40%) and prolactin (PRL) (26%) cells, and decreased GH and PRL mRNAs by in situ hybridization. ACTH cells increased 2.2-fold, whereas gonadotrophs and thyrotrophs were unchanged. Serum GH was undetectable (< 0.78 ng/ml), PRL levels were one third of WT (P < 0.05), IGF-I levels were 30% of WT (P < 0. 001), and T4 was normal. 10 human pituitary Rathke's cysts studied all showed conclusive LIF immunoreactivity in cyst-lining cells. Thus, intrapituitary murine LIF overexpression causes cystic invaginations from the anterior wall of Rathke's cleft, suggesting failed differentiation of Rathke's epithelium to hormone-secreting cells. Arrested murine pituitary maturation with formation of pituitary Rathke's cleft cysts, GH deficiency, and short stature provide a model to study human Rathke's cyst pathogenesis.