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Parathyroid hormone-related protein (PTHrP) was originally discovered as the tumor product that causes humoral hypercalcemia of malignancy. PTHrP is now known to be widely expressed in many normal fetal tissues where it may participate in the regulation of organogenesis. In this report, we document that overexpression of PTHrP in myoepithelial cells in the mammary glands of transgenic mice resulted in a form of breast hypoplasia characterized by a profound defect in branching morphogenesis of the developing mammary duct system. In addition, transgenic mice manifested a defect in lobuloalveolar development during pregnancy that seemed to be, in part, the consequence of an impaired ability to form terminal ducts in response to estrogen and progesterone stimulation. The effects of PTHrP on branching morphogenesis during breast development appeared to be the result of amino-terminal PTH-like sequences that signal through the PTH/PTHrP receptor, since overexpression of parathyroid hormone itself in the mammary glands of transgenic mice caused a similar development phenotype, and delivery of PTHrP (1-36) via locally implanted slow-release pellets impaired breast development in normal mice. These results suggest that PTHrP, which is a native product of mammary epithelial and myoepithelial cells may participate in normal breast development, perhaps as a locally secreted growth inhibitor.