An experimental transplantation model using human fetal skin was applied to approach the question of the embryologic origin of human Merkel cells. Palmar and plantar skin from five fetuses, between 8 and 11 weeks of estimated gestational age (EGA), was xenografted to subcutaneous beds of nude mice. After 4 or 8 weeks of growth, biopsies were taken from these xenografts and examined for the presence of Merkel cells, using immunocytochemistry with antibodies specific for simple epithelial-type cytokeratins and neuron-specific enolase (NSE) as well as using electron microscopy. Skin from the same fetuses at the time of transplantation was screened in the same way. In all fetuses, no (or very scarce) epidermal Merkel cells were detected at the transplantation time, but in all cases abundant epidermal Merkel cells of apparent human origin were found after 4 or 8 weeks in xenograft culture. Dermal nerve fibers, as recognized by neurofilament antibodies, were scarce or essentially absent in the xenografts. These results indicate that Merkel cells regularly develop in epidermis dissected and xenografted in an early fetal stage, although the dissection implies the interruption of the dermal nerves. The results strongly support the notion of the origin of Merkel cells from epidermal precursor cells. The apparent absence of dermal Merkel cells and dermal nerve fibers in the xenografts suggests that the presence of dermal sensory nerve fibers may be required for the dropping off of epidermal Merkel cells into the upper dermis, which occurs in normal fetal development.