Barrett's esophagus is considered to be a premalignant condition, and long-term surveillance seems mandatory with a careful search for dysplasia and carcinoma by means of multiple and repeated sets of biopsies. Reliable nonhistologic markers indicative of dysplasia or developing carcinoma are not yet available. To investigate development of dysplasia and carcinoma a prospective follow-up study was performed on 50 patients with Barrett's esophagus, without carcinoma at entrance to the study, for a period of 1.5-14 yr (mean, 5.2 yr). Barrett's epithelium was classified as fundic type, junctional or cardia type, or specialized columnar type. When classification in one of these three types was not possible because of lack of the characteristic features of the epithelia, the epithelium was classified as intermediate type. At entrance to the study, low-grade dysplasia was found in 6 patients, high-grade in 1 patient. During follow-up, dysplasia increased in frequency as well as in severity and was found almost exclusively in the specialized columnar- and intermediate-type epithelium. At the end of the observation period dysplasia had been found in 13 patients, in 10 scored as low-grade and in 3 as high-grade, and adenocarcinoma had developed in another 5 patients. This prospective study shows an incidence of carcinoma in Barrett's esophagus of 1 in 52 patient-years, a 125-fold increase compared with the general Dutch population. A sequence of worsening of dysplasia with development of carcinoma was observed in specialized columnar and intermediate-type epithelium. The results of this study support the need for a long-term clinical, endoscopic, and histologic follow-up program in patients with Barrett's esophagus.