The unintegrated gluon density in the photon is determined, using the Kimber-Martin-Ryskin prescription . In addition, a model of the unintegrated gluon is proposed, based on the saturation model extended to the large-x region. These gluon densities are applied to obtain cross sections for charm and bottom production in gamma-p and gamma-gamma collisions using the k_t factorization approach. We investigate both direct and resolved photon contributions and make comparison with the results from

more »

... e collinear approach and the experimental data. An enhancement of the cross section due to inclusion of non-zero transverse momenta of the gluons is found. The charm production cross section is consistent with the data. The data exceed our conservative estimate for bottom production in gamma-p collisions, but theoretical uncertainties are too large to claim a significant inconsistency. A substantial discrepancy between theory and the experiment is found for gamma gamma -> b bbar X, not being cured by the k_t factorization approach.