Clonal analysis of human prostate epithelial cells was undertaken in order to identify stem cells. Two types of colony were distinguished, termed type I and type II. Type I colonies were relatively small and irregular and contained a loose mixture of differentiated and undifferentiated cells. In contrast, type II colonies were large, round, and homogeneous, consisting almost exclusively of small undifferentiated and dividing cells. The colony-forming efficiency was 5.8% +/- 1.8 for freshly isolated epithelial cells. There were approximately 10 times as many type I as type II colonies and about 1 in 200 of the plated cells was capable of forming a type II colony. In three-dimensional culture on Matrigel, the type II colonies produced structures reminiscent of prostate epithelium, with luminal cells expressing markers of prostate epithelial differentiation, including the androgen receptor. On the basis of their proliferative characteristics and pluripotency, the type II colonies may be the progeny of stem cells and the type I colonies of a more differentiated transit-amplifying population.