The placenta undergoes extensive angiogenesis and cellular proliferation to establish adequate blood supply to the fetus. The aim of this study was to compare and contrast the immunolocalization of acidic and basic fibroblast growth factor (FGF) in both first trimester and term placenta and gestational decidua. Human choriocarcinoma cell line JEG-3 were employed as a model of cytotrophoblast and the effect of basic FGF on cell proliferation and phospholipase C and D activation investigated. Basic FGF-immunoreactivity (IR) was detected in or around cytotrophoblast cells and in extravillous trophoblast in first trimester placenta by immunohistochemistry using primary polyclonal rabbit antibodies. Identical staining patterns were produced by acidic FGF antibodies indicating colocalization of acidic FGF and basic FGF. At term, weaker and more diffuse staining was seen in the syncytiotrophoblast surrounding the placenta villi and strong staining was present in the smooth muscle cells of mid and large size placental vessels and in some endothelial cells. Endothelial cells and extravillous trophoblast stained strongly within the decidua at first trimester, whereas the glandular epithelium was weakly stained. Basic FGF induced [3H]thymidine incorporation in JEG-3 cells in a dose dependent manner and caused an increase in inosital phosphate accumulation in cells pre-labelled with myo-[3H]inosital at similar concentrations, suggesting a role of phospholipase C in JEG-3 cell proliferation. However, basic FGF failed to stimulate phospholipase D activity in cells pre-labelled with [3H]myristic acid. The detection of acid FGF and basic FGF on both maternal and fetal side of the placenta during early pregnancy suggests a role for FGF in angiogenesis, whereas localisation of the growth factor at term, when extensive angiogenesis has diminished, would indicate that FGF may be associated with more differentiated functions of the trophoblast. The nuclear localization of basic FGF in dividing but not non-dividing placental cells together with the effect of basic FGF on JEF-3 cells, strongly supports a role for basic FGF in cytotrophoblast proliferation in vivo.