Mice carrying an ovine beta-lactoglobulin (BLG) transgene secrete BLG protein into their milk. To explore transgene expression stability, we studied expression levels in three BLG transgenic mouse lines. Unexpectedly, two lines exhibited variable levels of transgene expression. Copy number within lines appeared to be stable and there was no evidence of transgene rearrangement. In the most variable line, BLG production levels were stable within individual mice in two successive lactations. Backcrossing demonstrated that genetic background did not contribute significantly to variable expression. Tissue in situ hybridization revealed mosaicism of transgene expression within individual mammary glands from the two variable lines; in low expressors, discrete patches of cells expressing the transgene were observed. Transgene protein concentrations in milk reflected the proportion of epithelial cells expressing BLG mRNA. Furthermore, chromosomal in situ hybridization revealed that transgene arrays in both lines are situated close to the centromere. We propose that mosaicism of transgene expression is a consequence of the chromosomal location and/or the nature of the primary transgene integration event.