Bone marrow biopsies of 674 patients with multiple myeloma (MM) were processed for diagnostic evaluation. Histologic variables were correlated with the clinical features to determine factors of value in predicting prognosis. Four of these were used to classify MM into six histologic types: Marschalko type; small cell type; cleaved type; polymorphous type; asynchronous type; and blastic type. These six types were subsequently combined into three prognostic grades: low, intermediate, and high, analogous to the malignant lymphomas. The quantity of plasma cell burden in the biopsy proved to be a useful criterion for histologic staging of MM, supplementing any clinical staging system in use. Both these parameters, grade and stage, provide information required for decisions on treatment modalities, while the effects of therapy can be monitored by sequential biopsies.