Fifteen patients with chronic renal failure commencing CAPD treatment were studied by a sensitive ferrokinetic technique. All were severely anaemic with a low red cell volume (RCV). Plasma volume (PV) was raised in twelve. Mean red cell lifespan (MRCL) was reduced in eleven subjects, and marrow iron turnover (MIT) was inappropriately low but this was not related to erythropoietin levels. Six patients were restudied after several months CAPD. PV fell in four and RCV increased in all six. MRCL rose to normal in three. The other three subjects has an increase in MIT. Erythropoietin levels did not change significantly. The major cause of uraemic anaemia is a failure of erythropoiesis to match fully the demands of red cell destruction.