We have taken advantage of the permissive environment of the early gestational age fetus to engraft human hematopoietic stem cells (HSC) into preimmune fetal lambs. The resulting chimeras exhibit long-term multilineage engraftment of human cells in the bone marrow (BM) and peripheral blood (PB). Long-term multilineage reconstitution of second generation recipients by human cells isolated from chimeric sheep BM indicates that the engraftment in this model involved long-term repopulating human HSC. The model appears to be sensitive enough to detect relatively small numbers of transplanted HSC from pre- and postnatal human sources. Finally, transplantation of mature T lymphocyte-containing cells from a variety of sources results in lethal graft-versus-host disease (GVHD), analogous to clinical BM transplantation, suggesting that, at least in some respects, the model is biologically relevant. The human-sheep model is promising and may have important advantages over murine models for the in vivo study of normal and abnormal hematopoiesis and as a potential assay system for human HSC.