Liver cells were isolated on Ficoll/Hypaque gradients from embryos or fetuses at 6-10 weeks of gestation; 2-20% of the cells expressed CD45 or HLA class I surface antigens and 2-6% expressed CD7. Other T- or natural-killer (NK)-cell-lineage-specific markers were undetectable. Liver-cell suspensions cultured in the presence of phytohemagglutinin and recombinant interleukin 2 gave rise to large proportions of CD3+ lymphocytes expressing either alpha/beta or gamma/delta T-cell receptors. This occurred not only in bulk cultures but also when cells were cloned under limiting dilution conditions. Importantly, these figures were obtained also in embryos at 6-8 weeks of gestation, which is before colonization of the thymic rudiment by T-cell precursors. When the same liver-cell suspensions were cultured in the presence of irradiated H9 cells and recombinant interleukin 2 (either in bulk cultures or under cloning conditions), large proportions of cells (or clones) expressed surface CD16 and CD56 antigens and displayed a strong cytolytic activity against both NK-sensitive (K562) and NK-resistant (M14) target cells. In addition, liver-derived T or NK cells expressed functional receptor molecules since they could be activated via either CD3/T-cell receptor or CD16 surface antigens, respectively. Further fractionation of liver cells on the basis of CD45 antigen expression indicated that only CD45+ cells could give rise to T or NK cells in culture. Thus, CD45 can be used as a marker for identification of an early liver-cell population containing T- and NK-cell precursors. That T or NK cells were derived from male embryos and not from the mother was shown by PCR amplification of X and Y chromosomal sequences. Our present data may offer an in vitro model for extrathymic embryonic T-cell maturation that can be used to examine fundamental aspects of human T-cell development and function.