Endoscopic polypectomy has become the preferred technique for the removal of most colorectal adenomas. Whether polypectomy alone or segmental colectomy is the appropriate management of the patient whose adenoma contains carcinoma is a controversial issue. We studied 129 colorectal carcinomas that arose in adenomas and in which invasion was no deeper than the submucosa of the underlying colonic wall. The following factors were evaluated: location; gross appearance (sessile versus pedunculated); histologic type of adenoma (tubular, villous, mixed); grade of carcinoma; level of invasion (0--carcinoma confined to the mucosa, 1--head, 2--neck, 3--stalk, 4--submucosa of underlying colonic wall); vascular invasion; and adequacy of excisional margins. Patients were divided into two groups with respect to outcome: adverse (dead from colorectal carcinoma, alive with colorectal carcinoma or positive nodes on colectomy), and favorable (absence of above). Sixty-three patients were treated by polypectomy alone and 66 by colectomy (21 preceded by polypectomy); there were no operative deaths. Mean follow-up was 81 mo. None of 65 patients with carcinoma confined to the mucosa had an adverse outcome, but 8 of 64 patients with invasive carcinoma did. Level 4 invasion (p less than 0.001) and rectal location (p = 0.025) were the only statistically significant adverse prognostic factors. Seven of 28 level 4 lesions and six of 42 rectal lesions had an adverse outcome; level 4 lesions were overrepresented in the rectum (14 of 42; p = 0.032). We conclude that the level of invasion should be the major factor in determining prognosis for the management of carcinoma arising in an adenoma.