Gastric adenocarcinoma is one of the leading causes of cancer mortality worldwide. It arises through a stepwise process that includes prominent inflammation with expression of interferon-γ (IFN-γ) and multiple other pro-inflammatory cytokines. We engineered mice expressing IFN-γ under the control of the stomach-specific H⁺/K⁺ ATPase β promoter to test the potential role of this cytokine in gastric tumorigenesis. Stomachs of H/K-IFN-γ transgenic mice exhibited inflammation, expansion of myofibroblasts, loss of parietal and chief cells, spasmolytic polypeptide expressing metaplasia, and dysplasia. Proliferation was elevated in undifferentiated and metaplastic epithelial cells in H/K-IFN-γ transgenic mice, and there was increased apoptosis. H/K-IFN-γ mice had elevated levels of mRNA for IFN-γ target genes and the pro-inflammatory cytokines IL-6, IL-1β, and tumor necrosis factor-α. Intracellular mediators of IFN-γ and IL-6 signaling, pSTAT1 and pSTAT3, respectively, were detected in multiple cell types within stomach. H/K-IFN-γ mice developed dysplasia as early as 3 months of age, and 4 of 39 mice over 1 year of age developed antral polyps or tumors, including one adenoma and one adenocarcinoma, which expressed high levels of nuclear β-catenin. Our data identified IFN-γ as a pivotal secreted factor that orchestrates complex changes in inflammatory, epithelial, and mesenchymal cell populations to drive pre-neoplastic progression in stomach; however, additional alterations appear to be required for malignant conversion.