Rodent fibroblasts explanted from embryos to culture undergo a period of declining growth rate in serial passages leading to crisis, followed by the appearance of variants which can multiply indefinitely. If the "immortal" cell line was established by low density passage, i.e., 3T3 cells, it has a low saturation density and is non-tumorigenic. If it was established by high density passage, it has a high saturation density and is tumorigenic. The establishment of cells goes through successive stages, including increased capacity to multiply in low serum concentration, growth to high saturation density, growth in suspension, assisted tumour formation in susceptible hosts and unassisted tumour formation. Chromosome aberrations and aneuploidy occur long before the capacity to produce tumours appears. Contrary to conventional belief, human fibroblast populations also undergo a continuous loss of capacity to multiply from the time of explantation, with only the longest surviving clone reaching the Hayflick limit. Neoplastic transformation of rodent cells is strongly favoured by maintaining them in a quiescent state at confluence for prolonged periods, which results in genetic damage to the cells. It also produces a large variety of chromosomal aberrations in human cells and extends their replicative lifespan. Individual clones are more susceptible to spontaneous transformation than their heterogeneous parental cultures. The implications of these results for tumour development in vivo are that oncogenic genetic changes may be common under stressful conditions which restrict replication, and that such changes are maximized when a rogue clone reaches a critical size that reduces stabilizing interactions with neighbouring clones. An alternative explanation, described in the Addendum, which we retrospectively favor is that the easily transformed clones are a minority in the uncloned parental population. The reason they transform before the parental population is that when they are expanded, they have more transformable cells available under the selective condition of confluence than the uncloned parental population from which they are derived.