We have developed a model system for studying proliferative retinopathy in vitro using bovine retinal explants cultured in collagen gels. Cellular outgrowth from retinal explants occurred after 7 days as single cells from peripapillary explants or as cell sheets and tubular outgrowths from peripheral retinal explants. Single cell outgrowths were shown immunohistochemically to be endothelial cells or macrophages; sheetlike and tubular outgrowths also constituted cords of endothelial cells with stromal macrophages, but in addition glial cells were closely associated with the endothelial cells. Cellular outgrowths were preceded by extensive macrophage activation within the ischemic retinal explant, suggesting that macrophage-derived angiogenic factors may be important in inducing retinal endothelial cell proliferation. In addition, glial cell-derived factors may have a role in the development of vessellike tubular structures from endothelial cell outgrowths.