Over-expression of ERBB2, a member of the family of transmembrane receptor tyrosine kinases, occurs in 15-30% of primary breast tumors and is associated with poor prognosis and chemoresistance to a variety of anticancer drugs. In this study, aiming to identify differentially-expressed genes involved in erbB2-mediated transformation of the breast, we generated SAGE libraries from two human mammary cell lines, derived from normal luminal cells, expressing different levels of erbB2. The parental cell line HB4a expresses basal levels and the C5.2 expresses high levels of erbB2. A total of 161,632 tags was generated by sequencing, 81,684 from HB4a cells (30,854 unique tags) and 79,948 from C5.2 cells (30,568 unique tags). The comparison between the HB4a and C5.2 libraries revealed 334 distinct transcripts more expressed in HB4a cells and 328 distinct transcripts more expressed in C5.2 cells. The expression pattern of some of these transcripts was further validated by RT-PCR. The C5.2 cell line, which over-express ERBB2, showed in comparison to HB4a cells a higher percentage of genes involved in transport, RNA processing, apoptosis and protein folding. A higher percentage of the genes more expressed in HB4a cells compared to C5.2 were found to be involved in signal transduction and cytoskeleton organization. The use of SAGE analysis allowed us to identify a significant number of genes implicated in different cellular pathways up- or down-regulated in the presence of ERBB2 over-expression, including genes not previously implicated in breast cancer that could be considered as potential candidate markers for prognosis and therapy.