A historical cohort of 153 patients with dysplastic nevi was studied for the development of melanoma. Each subject had a minimum follow-up of 5 years, with an average study follow-up of 94 months. Eleven new melanomas developed in 11 patients between 11 and 143 months (average 61 months) into the study period. Age-adjusted melanoma incidence in the cohort was 692/100,000 person years. Development of melanoma was strongly correlated with prior personal and/or family history of melanoma. Even among the 89 patients with no personal or family history of melanoma, the age-adjusted incidence of melanoma was an alarming 154/100,000 person years. Within this small, non-randomly ascertained cohort no association could be discerned between melanoma incidence and total number of banal or dysplastic nevi. These findings support the public health significance of the recognition of dysplastic nevi and confirm the importance of family history in evaluating melanoma risk associated with dysplastic nevi.