The invention provides a transgenic animal producing low-lactose milk, which is transformed with a gene encoding an extracellular lactase-hydrolyzing enzyme cloned from a human small intestinal cDNA library. The invention also provides a new extracellular lactase-phlorizin hydrolase (ecLPH) gene that can express human lactase-hydrolyzing enzyme in the mammary gland of animals. The invention can be used in the production of low-lactose milk.