Mice deficient in the p65 subunit of NF-kappaB die during fetal development. Introduction of p50/p65-deficient fetal liver cells into lethally irradiated hosts resulted in a severe deficit of fetal liver-derived lymphocytes and their immediate precursors but an overabundance of fetal liver-derived granulocytes. Surprisingly, simultaneous transplantation of wild-type bone marrow cells rescued the production of p50/p65-deficient lymphocytes. Expression of immunoglobulin K light chains on these rescued NF-kappaB-deficient B lymphocytes was normal. These results suggest that while p50 and p65 do not regulate the maturation of pre-B cells, NF-kappaB mediates the development or survival of an early lymphocyte precursor through regulation of an extracellular factor.