Cystatin C, a cysteine proteinase inhibitor, is expressed in the central nervous system (CNS) as well as many other organs of mammals. However, little is known concerning whether its expression is regulated under pathological conditions of the CNS and what types of cells are responsible for this regulation. We performed differential hybridization screening of cDNA libraries derived from the rat facial nucleus and found a cDNA of rat cystatin C to be up-regulated following facial nerve axotomy. In situ hybridization using an RNA probe for rat cystatin C revealed that cystatin C mRNA in the facial nucleus was markedly increased in amount by day 7 after axotomy and was then decreased to the normal level by day 50. The intense signal for cystatin C mRNA in the damaged facial nucleus was localized in the glial cells which had the morphological characteristics of microglia. Light and electron microscopic immunohistochemistry using a rabbit antibody specific for cystatin C confirmed that microglia in the damaged facial nucleus were strongly positive for cystatin C. The immunoreactivity was also found in the extracellular space, consistent with the fact that cells producing cystatin C generally secrete this protein. These results demonstrate that cystatin C is markedly up-regulated by microglia in response to axotomy and is probably secreted by these cells into the extracellular space, suggesting that this proteinase inhibitor has (a) significant function(s) in the processes of neuronal degeneration, regeneration, and/or repair subsequent to axotomy.