GaN epilayers have been grown on basal plane (0001) sapphire by plasma-assisted molecular beam epitaxy (MBE) with a novel, inductively coupled nitrogen plasma source. Films grown at 700 °C generate stimulated emission at 300 K when optically pumped in vertical geometry with ∼3.5 eV (&lgr;=355nm) photons. The extrapolated pump power threshold is ∼3.6MW cm−2which corresponds to an absorbed value of 700kW cm−2and a peak carrier number density of∼4×1019 cm−3. ©1997 American Institute of Physics.