The expression of β-catenin-dependent genes can be increased through the Cre recombinase (Cre)-mediated elimination of the exon 3-encoded sequence. This mutant β-catenin is termed DE3, and promotes the expression of β-catenin-dependent genes. Our previous study used the DE3 model to demonstrate that persistent β-catenin activity inhibited bronchiolar Clara-to-ciliated cell differentiation. The present study was designed to evaluate the roles of β-catenin in regulating the tracheal progenitor cell hierarchy. However, initial experiments demonstrated that the tetracycline-responsive element-Cre transgene (TRE-Cre) was active in the absence of a reverse tetracycline transactivator driver or inducer, doxycycline (Dox). This spurious TRE-Cre transgene activity was not detected using the ROSA26-floxed STOP-LacZ reporter. To determine if the phenotype was a consequence of genotype or treatment with Dox, tracheal and lung specimens were evaluated using quantitative histomorphometric techniques. Analyses of uninduced mice demonstrated a significant effect of genotype on tracheal epithelial cell mass, involving basal, Clara-like cell types. The bronchial and bronchiolar Clara cell mass was also decreased. Paradoxically, an effect on ciliated cell mass was not detected. Activation of the β-catenin reporter transgene TOPGal demonstrated that β-catenin-dependent gene expression led to the genotype-dependent tracheal and bronchiolar phenotype. Comparative analyses of wild-type or keratin 14-rtTA+/0/TRE-cre+/0/DE3+/+ mice receiving standard or Dox chow demonstrated an effect of treatment with Dox on basal, Clara-like, and Clara cell masses. We discuss these results in terms of cautionary notes and with regard to alterations of progenitor cell hierarchies in response to low-level injury.