Abstract. The placenta produces prolactin (PRL)-or growth hormone-like hormones known as placental lactogens (PLs) which play roles in the maternal endocrine system and fetal growth development. We previously cloned a cDNA encoding a novel rat PL, PL-I mosaic (PL-Im), which is specifically expressed at mid-pregnancy. In this study, the biological activity of PL-Im was evaluated by producing the recombinant protein (recPL-Im) by means of a baculovirus/insect cell expression system. RecPL-Im demonstrated binding activity for PRL receptor in a radioreceptor assay (RRA) system with rat liver membrane fraction and 125 I-ovine PRL (oPRL). In addition, the activity of recPL-Im is comparable to oPRL in the Nb2 cell proliferation assay. Interestingly, recPLIm stimulated progesterone secretion in a concentration-dependent manner in a primary culture of luteal cells from pregnant rat, whereas oPRL had no effect on luteal cells. The luteotropic function of recPL-Im was accompanied by suppression of the secretion of 20α-dihydroprogesterone (20α-OHP) in the culture. PL-Im therefore has ability to bind PRL-receptor and express PRL-like activity. In addition, recPL-Im has luteotropic hormone (LTH) activity and its activity is qualitatively different from that of PRL.