High-frequency microsatellite instability (MSI), defined as more than 20% unstable loci, is an inconsistent finding in hematologic malignancies; consequently, the significance of deficient DNA mismatch repair (MMR) to their pathogenesis has been questioned. To further investigate the relationship between MMR deficiency and genomic instability in hematologic malignancies, this study evaluated MSH2-/- murine lymphomas for insertion/deletion (ID) mutations within the transforming growth factor (TGF)-beta receptor type II (TbetaR-II) gene and MSI at 10 neutral microsatellites. The lymphomas displayed ID mutations within short mononucleotide runs of TbetaR-II at a high frequency, whereas nonmalignant tissue from corresponding animals lacked mutations. Loss of TbetaR-II transcripts and protein was seen in 6 of 7 murine lymphomas harboring acquired TbetaR-II mutations. In the analysis of paired nonmalignant and tumor DNA samples, low-frequency but not high-frequency MSI was found. Low-frequency MSI occurred in 8 of 20 lymphomas and 12 displayed microsatellite stability. MSI was even less frequent in nonmalignant tissue as only 3 of 20 samples displayed low-frequency MSI and 17 displayed stability. Evaluation of 20 single cell clones from the MSH2-/- lymphoma cell lines R25 and L15 identified high-frequency MSI in 4 and 2 clones, respectively. The remaining clones showed low-frequency MSI or stability. These findings suggest that acquired TbetaR-II mutations represent important inactivating events in tumor pathogenesis following MSH2 deficiency. Furthermore, for some hematolymphoid malignancies, the evaluation of cancer-associated genes for ID mutations may represent a more sensitive marker of MMR deficiency than evaluation of neutral microsatellites for high-frequency MSI. (Blood. 2000;95:1767-1772)