The p53 tumor suppressor protein is a sequence-specific transcriptional activator of target genes. Exposure of cells to DNA damage results in accumulation of biochemically active p53, with consequent activation of p53-responsive promoters. In order to study how the transcriptional activity of the p53 protein is regulated in vivo, a transgenic mouse strain was generated. These mice harbor the p53-dependent promoter of the mdm2 gene, fused to a lacZ reporter gene. Induction of lacZ activity by DNA damage (ionizing radiation) was monitored in embryos of different p53 genotypes. The transgenic promoter was substantially activated in vivo following irradiation; activation required functional p53. The activation pattern became more restricted with increasing embryo age, as well as with the state of differentiation of a given tissue. Generally, maximal p53 activation occurred in rapidly proliferating, relatively less differentiated cells. A striking extent of haploinsufficiency was revealed—induction of promoter activity was far less efficient in mice carrying only one wild-type p53 allele. This suggests that normal levels of cellular p53 are limiting, and any further reduction already compromises the p53 response significantly. Thus, the activation potential of p53 is tightly controlled in vivo, both spatially and temporally, and an important element in this control is the presence of limiting basal levels of activatable p53.