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In contrast to mouse epidermal cells, human skin keratinocytes are rather resistant to transformation in vitro. Immortalization has been achieved by SV40 but has resulted in cell lines with altered differentiation. We have established a spontaneously transformed human epithelial cell line from adult skin, which maintains full epidermal differentiation capacity. This HaCaT cell line is obviously immortal (greater than 140 passages), has a transformed phenotype in vitro (clonogenic on plastic and in agar) but remains nontumorigenic. Despite the altered and unlimited growth potential, HaCaT cells, similar to normal keratinocytes, reform an orderly structured and differentiated epidermal tissue when transplanted onto nude mice. Differentiation-specific keratins (Nos. 1 and 10) and other markers (involucrin and filaggrin) are expressed and regularly located. Thus, HaCaT is the first permanent epithelial cell line from adult human skin that exhibits normal differentiation and provides a promising tool for studying regulation of keratinization in human cells. On karyotyping this line is aneuploid (initially hypodiploid) with unique stable marker chromosomes indicating monoclonal origin. The identity of the HaCaT line with the tissue of origin was proven by DNA fingerprinting using hypervariable minisatellite probes. This is the first demonstration that the DNA fingerprint pattern is unaffected by long-term cultivation, transformation, and multiple chromosomal alterations, thereby offering a unique possibility for unequivocal identification of human cell lines. The characteristics of the HaCaT cell line clearly document that spontaneous transformation of human adult keratinocytes can occur in vitro and is associated with sequential chromosomal alterations, though not obligatorily linked to major defects in differentiation.