Carcinogenesis involves a multistep process whereby a normal healthy cell undergoes both immortalization and oncogenesis to become fully transformed. Immortalization results from the subversion of critical cell cycle regulatory checkpoints, thereby allowing a cell to extend its finite life span and to maintain telomeric length. Oncogenesis is the manifestation of additional genetic events that are capable of conferring upon the cell an actual growth advantage. Such an advantage may relieve a cell of its normal requirements for a particular growth factor or may enhance the ability of a cell to proliferate outside of its normal microenvironment. To further investigate this multistep process, we developed an immortalized mammary epithelial cell line by overexpressing the catalytic subunit of telomerase (human telomerase reverse transcriptase) in primary human mammary epithelial cell lines. We present evidence that the overexpression of human telomerase reverse transcriptase was sufficient to extend the life span of the cells and allow for additional events that lead to immortalization. The result was the establishment of an IMEC line. Biochemical analysis of these cells indicates a basal epithelial phenotype with expression of high molecular weight cytokeratins. We show that continued growth of the IMECs is rigorously dependent upon both insulin and epidermal growth factor, and that the mitogenic effects of these factors on the IMECs are mediated in part by AKT. In addition, IMECs express the p53 family member DeltaN-p63-alpha, which is found in basal epithelial cells of many tissues and has been implicated as playing an essential role in normal epithelial development. Our studies suggest that the immortalization of basal epithelial cells of the mammary gland may be an early step in the initiation of a subset of breast cancers with a basal epithelial phenotype.