Pancreatic adenocarcinomas display foci of duct-like structures that are positive for markers of pancreatic ductal cells. The development of these tumors is promoted by conditions leading to acinar-to-ductal metaplasia, a process by which acinar cells are replaced by ductal cells. Acinar-to-ductal metaplasia has recently been shown to proceed through intermediary cells expressing Nestin. To create an in vitro system to study pancreatic adenocarcinomas, we had used an hTERT cDNA to immortalize primary cells of the human pancreas. In this report, we show that the immortalized cells, termed hTERT-HPNE cells, have the ability to differentiate to pancreatic ductal cells. Exposing hTERT-HPNE cells to sodium butyrate and 5-aza-2′-deoxycytidine lead to the formation of pancreatic ductal cells marked by the expression of MDR-1, carbonic anhydrase II, and the cytokeratins 7, 8, and 19. hTERT-HPNE cells were found to have properties of the intermediary cells formed during acinar-to-ductal metaplasia, which included their undifferentiated phenotype, expression of Nestin, evidence of active Notch signaling, and ability to differentiate to pancreatic ductal cells. These results provide further evidence for the presence in the adult pancreas of a precursor of ductal cells. hTERT-HPNE cells should provide a useful model to study acinar-to-ductal metaplasia and the role played by this process in pancreatic cancer development.