The murine MBT-2 bladder tumor model in syngeneic C3H/HeN mice was used to investigate the feasibility of gene therapy based on the delivery of interferon-gamma (IFN-gamma) in vivo by retroviral vectors. We constructed a recombinant retroviral vector pRUFneo/IFN-gamma, which was transfected into a retroviral packaging cell line psiCRE, to produce psiCRE/pRUFneo/IFN-gamma cells. The expressions of the neo and IFN-gamma genes were verified by reverse transcription-polymerase chain reaction and IFN-gamma was detected in the culture supernatant from psiCRE/pRUFneo/IFN-gamma cells. After receiving MBT-2 cells admixed with retroviral pRUFneoIFN-gamma supernatant, C3H/HeN mice exhibited lower tumor incidence, lower tumor mass, and higher survival rate, as well as higher antitumor responses compared to those injected with MBT-2 cells admixed with control retroviral supernatant. Moreover, the retroviral pRUFneoIFN-gamma supernatant was able to suppress the growth of rechallenged tumors in postoperated mice. Although the IFN-gamma protein secreted from psiCRE/pRUFneo/IFN-gamma cells partly contributes to the antitumor effect of retroviral pRUFneoIFN-gamma supernatant, the retroviruses carrying the IFN-gamma gene transduced MBT-2 cells in vivo, which may result in enhancing local IFN-gamma production from tumor cells. Because bladder is suitable for the intravesical instillation of therapeutic agents, in vivo administration of retroviral vectors encoding IFN-gamma may be explored for the treatment of bladder cancer.