We examined the preneoplastic nature of atypical adenomatous hyperplasia (AAH) of the lung by comparing the proliferative activity, p53 oncosuppressor gene product and loss of heterozygosity (LOH) on 3p, 9p and 17p of 20 AAH lesions (8 cases) with corresponding normal peripheral lung tissue and adenocarcinoma from the same cases. Analysis of proliferative activity with the Ki-67 labelling index and argyrophilic nucleolar organizer regions (AgNORs) score indicated that AAH had a proliferative activity intermediate between that of normal cell and adenocarcinoma. Although low level expression of p53 was detected in 7 AAH lesions, the intensity of p53 expression in AAH was weaker than that in carcinomas. Microsatellite analysis of chromosome 3p, 9p and 17p showed LOH of 18%, 13% and 6% respectively in the AAH lesions, while the corresponding carcinomatous lesions showed LOH of 67%, 50% and 17% respectively. All AAH lesions that showed LOH had moderate or severe histological atypia. One AAH lesion with moderate atypia showed LOH both on 3p and 17p. In conclusion, these results indicated that AAH lesions with moderate or severe atypia may show the preneoplastic stage of lung adenocarcinoma.