Tissue recombinants of embryonic urogenital sinus mesenchyme (UGM) and epithelium of the urinary bladder (urothelium, BLE) of adult rats and mice were grown for 3-30 d in male syngeneic hosts. Short-term in vivo growth indicated that prostatic morphogenesis is initiated as focal outgrowths from the basal aspect of the adult urothelium. The solid epithelial buds elongate, branch, and subsequently canalize, forming prostatic acini. After 30 d of growth in the male hosts, prostatic acini exhibit secretory activity. The marked changes in urothelial morphology induced by the UGM are accompanied by the expression of fine-structural features indicative of secretory function (rough endoplasmic reticulum, Golgi apparatus, and secretory granules). During this process, urothelial cells express prostatic histochemical markers (alkaline phosphatase, nonspecific esterase, glycosaminoglycans) and prostate-specific antigens. The expression within BLE of prostatic characteristics is associated with the loss of urothelial characteristics. These data indicate that adult urothelial cells retain a responsiveness to embryonic mesenchymal inductors. Furthermore, mesenchyme-induced changes in urothelial cytodifferentiation appear to be coupled to changes in functional activity.