This study attempts to determine whether fetal thalamic neuroblasts from rat embryos (embryonic age 15 days) labeled with horseradish peroxidase (HRP) can differentiate into their normal dendritic phenotype when transplanted as a cell suspension into a lesioned site in the adult somatosensory thalamus. The HRP labeling provided a Golgi-like staining of numerous neurons up to 12-14 days after transplantation. There were three main results. 1) As early as 2 days after transplantation three morphologic cell types were observed: Two were bipolar and the third multipolar. These cellular profiles are characteristic of adult ventroposterolateral, reticular, and ventroposteromedial neurons and suggest that transplanted neurons can take shape in the absence of specific arrangements of afferent fibers. 2) The initial stage of dendritic growth was characterized by numerous growing specializations and consisted of a rapid, arborizing growth that appeared to proceed at an accelerated rate relative to normal development. During the later stage, which was characterized by the great reduction of growing specializations, dendritic remodeling resulted in a simpler morphology, and the transplanted neurons did not achieve an adult morphology. 3) Putative axons exhibiting growth cones were present in impressive densities in the transplants, and a number of them grew into the neuron-depleted host thalamus. A very small number of axons grew into host gray matter outside the lesioned area, indicating that neurodegenerative areas provide a better substrate for neurite outgrowth than intact tissue. In rare instances axons were visible in the internal capsule, indicating that the biochemical inhibition provided by mature myelin and oligodendrocytes may not be an absolute obstacle to axonal growth.