DNA from hepatocyte nodules induced in rats with dietary DL-ethionine and from the surrounding non-nodular liver contained less 5-methyldeoxycytidine per deoxycytidine when compared with that from normal adult liver. The degree of apparent hypomethylation, 37% in nodules and 20% in the surrounding liver, decreased somewhat (29% and 16% respectively) at 2 weeks after terminating the exposure to ethionine. Nodules and surrounding liver, like normal liver, responded to partial hepatectomy with a decrease in the 5-methyldeoxycytidine level at 24 hrs and a return to the level at the time of partial hepatectomy by 38 hrs. These findings indicate the need for careful control of cell proliferation in comparing the levels of a post-replicative DNA modification, methylation, in proliferating and non-proliferating cell populations. These findings also suggest that a portion of the hypomethylation in preneoplastic nodules may be due to a bona fide decrease in the level of cytosine methylation in the parental strand of DNA. This hypomethylation could be one basis for the altered gene expression in hepatocyte nodules, possible precursors for liver cancer.