The effects of insulin, hydrocortisone, and prolactin on the morphology of explants from midpregnant mouse mammary glands were studied. Insulin promotes the formation of daughter cells within the alveolar epithelium which are ultrastructurally indistinguishable from the parent cells. The addition of hydrocortisone to the medium containing insulin brings the daughter cells to a new, intermediate level of ultrastructural development by effecting an extensive increase of the rough endoplasmic reticulum (RER) throughout the cytoplasm and an increase in the lateral paranuclear Golgi apparatus. When prolactin is added to the insulin-hydrocortisone medium, the daughter cells complete their ultrastructural differentiation. There is a translocation of the RER, Golgi apparatus, and nucleus and the appearance of secretory protein granules within the cytoplasm. There is excellent correlation between the ultrastructural appearance of the alveoli and their capacity to synthesize casein.

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