Infection with human papillomavirus type 16 (HPV-16) can lead to low- or high-grade squamous intraepithelial lesions (LSIL or HSIL). Here we show that these in vivo disease states can be replicated in raft cultures of early-pass HPV-16 episomal cell lines, at both the level of pathology and the level of viral gene expression. A reduced responsiveness to cell-cell contact inhibition and an increase in E6/E7 activity correlated closely with phenotype. Similar deregulation is likely to underlie the appearance of LSIL or HSIL soon after infection.