The hematopoietic potential of cryopreserved and ex vivo manipulated umbilical cord blood (UCB) samples was evaluated in vitro and in vivo. Phenotypic analysis shows that approximately 1% of cord blood mononuclear cells express high levels of CD34 antigen on their surface (CD34hi), but none of a panel of lineage antigens (Lin-), suggesting that they are hematopoietic progenitor cells that have not yet committed to a specific lineage. Approximately 1% of CD34hi/Lin- cells are primitive hematopoietic progenitors that produce B lymphoid and multiple myeloid progeny for up to 7 weeks in stromal cell cultures. Twenty-one percent (+/- 13%) of CD34hi/Lin- cells also express low levels of the Thy-1 antigen and are threefold to fourfold enriched over CD34hi/Lin- cells in primitive hematopoietic potential as measured by long-term culture and phenotypic analysis. One-week liquid cultures of CD34-enriched UCB progenitor cells in the presence of interleukin (IL)- 3, IL-6, and stem cell factor (SCF) results in a two-fold to threefold expansion of progenitors capable of reinitiating long-term stromal cell cultures. Only the CD34hi/Thy-1+/Lin- cell population was capable of maintaining progenitors with secondary transfer potential in long-term stromal cell cultures and is thus postulated to contain all of the primitive hematopoietic stem cells in UCB. The in vivo transplantation potential of UCB was also measured. Ex vivo manipulated UCB progenitor cells were used to engraft irradiated human thymus fragments implanted in severe combined immunodeficiency (SCID) mice. Thymic engraftment with >5% donor-derived cells and a normal CD4/CD8 distribution was observed in 19 of 23 tissues tested. UCB cells from in vitro expansion cultures engrafted with efficiencies comparable to nonexpanded cells. Similar results were obtained for UCB engraftment of human bone fragments implanted in SCID mice. In all cases, engraftment was achieved in competition with endogenous competitor stem cells and across major histocompatibility barriers. Taken together, this data demonstrates that human UCB is a rich source of multipotent hematopoietic progenitors that can be cryopreserved, enriched by physical methods, and expanded in a limited fashion without measurable loss of long-term culture or in vivo engrafting potential as measured in these assays.