A CNS-derived conditionally immortalized temperature-sensitive neural progenitor (CINP) cell line was used to generate NGF-secreting cells suitable for intracerebral transplantation. The cells were transduced by repeated retroviral infection, using a vector containing the mouse NGF cDNA under the control of the LTR promoter. Subcloning at the permissive temperature (33 degrees C) identified a highly NGF-secreting clone (NGF-CINP), which contained multiple copies of the transgene and released NGF at a rate of 2 ng/hr/10(5) cells in vitro, both at 33 and 37 degrees C, which was approximately 1 order of magnitude higher than what was possible to achieve in the heterogeneously infected cell cultures. After transplantation to the brain, the NGF-CINPs differentiated into cells with a predominant glia-like morphology and migrated for a distance of 1–1.5 mm from the implantation site into the surrounding host tissue, without any signs of overgrowth and tumor formation. Grafts of NGF-CINP cells implanted into the septum of adult rats with complete fimbria-fornix lesion blocked over 90% of the cholinergic cell loss in the medial septum and grafts placed in the intact striatum induced accumulation of low-affinity NGF receptor positive fibers around the implantation site. Expression of the NGF transgene in vivo was demonstrated by RT-PCR at 2 weeks after grafting. It is concluded that the immortalized neural progenitors have a number of advantageous properties that make them highly useful experimental tools for gene transfer to the adult CNS.