To understand the role of TNF in the regulation of inflammation and the development of autoimmune diseases such as insulin-dependent diabetes mellitus, we produced transgenic mice in which the synthesis of murine TNF-alpha was directed by the rat insulin II promoter. The expression of the TNF-alpha transgene was restricted to the pancreas, in contrast to TNF-beta expression from the same promoter, in which the transgene was expressed in the pancreas, kidney, and skin. The expression of TNF-alpha in the pancreas of transgenic mice resulted in an overwhelming insulitis, composed of CD4+ and CD8+ T cells and B220+ B cells, considerably greater than that of TNF-beta transgenics. Moreover, in contrast to the predominant peri-insulitis observed in TNF-beta transgenic mice, the majority of the infiltrate in the TNF-alpha transgenic mice was within the islet itself. These unique patterns of infiltration were observed in the F1 progeny of crosses with C57BL/6 as well as NOD. Both TNF-alpha and TNF-beta transgenic mice show elevated expression of leukocyte adhesion molecules VCAM-1 and ICAM-1 in islet endothelia and increased expression of MHC class I on islet cells. This inflammation did not result in reduced insulin content of the islets, nor did it lead to diabetes. These data suggest that additional stimuli are necessary to initiate the process of islet destruction.