Because serum albumin is specifically produced by mature hepatocytes, detection system of albumin producing cells could be a valuable tool to visualize liver regeneration or development. We have developed here an albumin enhancer/promoter-driven AlbDsRed2 Tg rat that expresses DsRed2, having liver-specific reporter gene expression of red fluorescent protein. To study the transdifferentiation of bone marrow cells (BMCs) into albumin producing cells, BMCs from the Alb-DsRed2 Tg rat were injected into rats having acute liver damage caused by 2-acetylaminofluorene plus carbon tetrachloride and chronic liver damage by repeated administration Of CCl4. DsRed2-positive cells were generated in the recipient liver after BMC injection. The number of transdifferentiated DsRed2-positive cells in chronic liver injury model was increased comparing with that in acute injury model. We propose that the Alb-DsRed2 Tg rat is well suited to studying in vivo liver regeneration. (C) 2003 Elsevier Inc. All rights reserved.