The inflammatory response has been characterized in the lumbosacral segments (L4-S1) of rats after spinal transection at T8. Immune cells were identified immunohistochemically using antibodies to complement type 3 receptor, CD11b (OX-42), the macrophage lysosomal antigen, CD68 (ED1), major histocompatibility complex class II (MHC II), and CD163 (ED2), a marker of perivascular cells. One week after cord transection, OX-42+ microglial density had nearly doubled. In the white matter, microglia became enlarged, often with retracted processes. In contrast, microglia in the grey matter remained ramified although nearly half of those lying medially contained clusters of ED1+ granules. After 8 weeks, ED1+ (+/-MHC II) macrophages were prominent in regions of Wallerian degeneration extending from dorsolateral to ventral funiculi. Microglial density remained raised in grey matter, particularly in the ventral horns of L4/5. Ramified microglia expressing MHC II+ (+/-ED1) extended from deep in the dorsal columns and around the central canal to the ventral columns. More ED2+ (+/-MHC II) perivascular and meningeal cells were recruited and expressed ED1. Thus, distinct from their conversion into macrophages in the white matter, the activation of ramified microglia after degeneration in the grey matter involves expression of ED1 without morphologic transformation.