Morphologically distinct lymphoid cells with homogeneous, condensed chromatin and scant cytoplasm can be observed in large numbers in the bone marrow of children with a variety of hematologic and nonhematologic disorders. In some patients, these cells may account for greater than 50% of the bone marrow cells, creating a picture that can be confused with acute lymphoblastic leukemia (ALL) or metastatic tumor. Although originally called hematogones (HGs), a variety of other names have been proposed for these unique cells. The clinical significance of expanded HGs has not been resolved, and the biologic features of these cells are incompletely described. In this study, we correlate the clinical, morphologic, cytochemical, flow cytometric, molecular, and cytogenetic properties of bone marrow samples from 12 children with substantial numbers of HGs (range 8% to 55% of bone marrow cells). Diagnoses in these patients included anemia, four; neutropenia, one; anemia and neutropenia, one; idiopathic thrombocytopenic purpura, two; retinoblastoma, two; Ewing's sarcoma, one; and germ cell tumor, one. Flow cytometric analyses of bone marrow cells demonstrated a spectrum extending from early B-cell precursors (CD10+, CD19+, TdT+, HLA-Dr+) to mature surface immunoglobulin-bearing B cells in these patients, corroborating our morphologic impression of HGs, intermediate forms, and mature lymphocytes. DNA content was normal, and no clonal abnormality was identified by either cytogenetic or immunoglobulin and T-cell receptor (TCR) gene rearrangement studies. Follow-up ranged from 3 months to 3 years. None of the patients has developed acute leukemia or bone marrow involvement by solid tumor. The possible role of HGs in immune recovery and hematopoiesis is presented.