The expression of various components of the antigen receptor is closely associated with the developmental progression of B lymphocytes. For this reason, introduction of rearranged Ig transgenes exerts profound effects on B cell development. In these studies we show that the presence of transgenes for both mu and delta H as well as L chains accelerates the rate of B cell maturation resulting in the appearance of large numbers of IgD-expressing B lymphocytes in vitro that are otherwise undetectable. In addition, allelic exclusion, normally exerted very effectively by these particular transgenes (carried in the MD-3 strain), was lost in the long-term bone marrow cultures. These findings can be recapitulated in vivo by serial adoptive transfers of bone marrow cells from the transgenic animals into lethally irradiated recipients. We conclude from these studies that allelic exclusion is not necessarily mediated by any one event but may be a result of the integrated occurrence of Ig H chain gene rearrangement, accumulation of transcription factors, along with the ordered progression of B cell differentiation under the influence of the appropriate inductive microenvironment. These findings may account for at least some of the observed cases of allelic inclusion in transgenic animals.