A complementary DNA library from MCF-7 cells was screened using 32P-cDNA derived from a breast carcinoma and from normal breast tissue. From 10(5) plaques (20% of library) we obtained a clone (Md2) which was differentially expressed in the carcinoma. The distribution of its corresponding transcript of 6-700 nucleotides was examined in normal and neoplastic cells, by filter and in situ hybridisation. We observed localisation of 35S-Md2 to the tumour cells of breast cancers with no significant reaction over stromal or vascular elements or on normal ductal epithelia. M13 sequencing showed Md2 to be 250 nucleotides in length, of which 197 were homologous to the 3'-untranslated region and a short open reading frame of the pS2 gene (Masiakowski et al., 1982). Md2 mRNA was found principally in breast carcinoma cell lines and tumours, with low levels in benign breast disease and no expression in non-breast squamous cell lines. Approximately 43% (23/54) of carcinomas contained this mRNA (varying from + to + + + + level); it was present in 20/38 (53%) of ER positive carcinomas compared to 3/16 (19%) of ER negative carcinomas. In 21 patients who had undergone primary endocrine therapy for recurrent disease expression of Md2 in the primary tumour correlated with the subsequent response to treatment (P = 0.041) and was of similar predictive value as ER status. Both tests correctly predicted outcome in about 76% of cases.