The growth and differentiation potential of rabbit tracheal basal cells were investigated in vitamin A deficient mice. Denuded rat tracheal grafts were xenotransplanted into nude mice made vitamin A deficient by feeding them retinol-free pellets from mid-gestation. Rabbit tracheal epithelial cells harvested enzymatically or cells derived from a basal-cell-rich fraction obtained by elutriation (purity 93.3%) had previously been inoculated into the grafts (n = 8, each). The grafts were implanted into the vitamin A deficient or control mice aged about 10 weeks. Four weeks later, the grafts were retrieved for histological examination. The graft epithelium established by either basal cells or un-fractionated cells in vitamin A deficient hosts (groups 1 and 2, respectively) was atrophic, whereas grafts repopulated with both cell types in the controls had pseudostratified columnar epithelium. Group 1 and 2 grafts both showed squamous metaplasia; 10 metaplastic foci in 32 tracheal rings in group 1 (P < 0.02 or 0.002, compared with values for group 2 or controls, respectively), and 2 foci in 35 rings in group 2 (no statistical difference compared with controls). In conclusion, during vitamin A deficiency, rabbit tracheal epithelial cells, including the progeny of highly-purified basal cells, lost their potential for establishing a mucociliary epithelium and rather appeared to undergo squamous metaplasia.