Many trials have been made to produce transgenic animals using sperm cells as a vector transferring foreign DNA into eggs, but reliable results are yet to be obtained (Brinster et al., 1989; Lavitrano et al., 1989; Bachiller et al., 1991; Sato et al., 1994). Recently, one of author(SO) demonstrated that mouse blastocysts derived from eggs fertilized by spermatozoa of male mice single injected with liposome-DNA complexes within the testis expressed thegene (Ogawa et al., 1995.) Here we report that a single injection of liposome-encapsulated DNAs into the testis of either male rats or mice resulted in successfully gene transfer to the postpartum progeny. The expression of mRNA derived from transgenes was also demonstrated in transgenic animals thus obtained. Further, the transmission of the exogenous gene to the descedants was confirmed in one line of transgenic rat up to F4 generation, indicating that the gene was stably incorporated into the germ line. Thus, direct single injection of foreign DNA into the testis provides a novel and convenient means to generate transgenic animals.