Rathke’s pouch tissue, from rat embryos of 11–15 days’ gestation, was microsurgically removed and transplanted into the hypothalamus of hypophysectomized adult females. The hosts were sacrificed 4 weeks later; brain and target organs were preserved for histological examination. Plasma samples were taken for the radioimmunoassay (RIA) of follicle stimulating hormone (FSH) and luteinizing hormone (LH). The implanted tissue invariably developed along certain lines. Undifferentiated primitive cells were found associated with nervous tissue, dense connective tissue, cartilage and glandular cells. In every age group, some implants became invasive, forming massive growths in the brain. These tumorous properties were principally associated (p < 0.05) with tissue from 12-day embryos. Pituitary primordia from all ages demonstrated the ability to develop into functional adenohypophyseal tissue. Target organ stimulation indicated a secretion of corti-cotropin, thyrotropin and somatotropin. FSH and/or LH were detected by RIA in the plasma of 61 % of the test animals. We suggest that this system offers unique opportunities for future investigations into the mechanisms that determine whether embryonic epithelial tissue will remain under normal growth control or will become tumorous or even canc