Activation-induced DNA cytidine deaminase (AID) is required for somatic hypermutation (SHM) and efficient class switch recombination (CSR) of immunoglobulin (Ig) genes. We created AID-transgenic mice that express AID ubiquitously under the control of a beta-actin promoter. When crossed with AID-/- mice, the AID-transgenic,AID-/- mice carried out SHM and CSR, showing that the AID transgenes were functional. However, the frequencies of SHM in V- and switch-regions, and CSR were reduced compared to those in a wild type AID background. Several criteria suggested that the inefficiency of SHM was due to reduced AID activity, rather than lack of recruiting error-prone DNA repair. High levels of AID mRNA were produced in resting B cells and kidney, cells that do not express AID in wild type mice. Compared with these cells, activated B cells expressed about an order of magnitude less AID mRNA suggesting that there may be a post-transcriptional mechanism that regulates AID mRNA levels in professional AID producers but not other cells. The AID protein expressed in resting B cells and kidney was phosphorylated at serine-38. Despite this modification, known to enhance AID activity, resting B cells did not undergo SHM. Apparently, the large amounts of AID in resting B cells are not targeted to Ig genes in vivo, in contrast to findings in vitro.