We have shown previously that the cause of anemia in healthy elderly subjects can usually not be identified. In this study, hematopoiesis was examined in 18 healthy elderly subjects with unexplained anemia and in 15 young and 15 healthy elderly individuals without anemia. No reduction in circulating testosterone was noted, making decreased androgen levels as a cause for the anemia unlikely. The 2,3 diphospho- glycerate (2,3DPG) levels in the anemic subjects were significantly higher than their corresponding controls, suggesting that the anemia was pathologic, as no increase would be expected if the low hemoglobin was a physiologic adjustment to age. The anemia was associated with a reduction in marrow normoblast and CFU-E number, but no decrease in BFU- E levels was seen. This suggests that the mechanism of the anemia is a decrease in stem cell proliferation. This could be caused by a reduction in circulating erythropoietin or a defect in end organ response. A second possibility is that a basic cellular abnormality exists. The presence of an overall reduction in hematopoiesis in anemic elderly (decreased peripheral blood counts, reduced marrow myeloid precursors, and CFU-C levels) makes this especially likely. The abnormality may be caused by a mechanism unrelated to the aging process. The fact that nonanemic elderly also have reductions in hematopoiesis suggests that age contributes to the defect.