The present study describes three subsets of bone marrow-derived Lin CD43+B220(low) (B220(low)) progenitor cells which represent distinct stages in hematopoietic development. These populations differ in their expression of CD24 and ckit and the occurrence of IgH gene rearrangement. B220(low) CD24-ckit(hi) progenitors have their IgH loci in germ-line configuration and are multipotent since they can give rise to B cells, T cells and myeloid cells. B220lowckit(hi) cells which have acquired CD24 expression have retained IgH loci in germ-line configuration and the ability to generate B cells, however, they have lost the ability to generate T cells and myeloid cells. Thus acquisition of CD24 by B220(low) cells occurs concurrently with the transition from a multipotent to a lineage-restricted progenitor population. B220(low)CD24+ cells expressing low levels of ckit are also lineage restricted, giving rise to only B cells and have begun D-J(H) rearrangement, implying that initiation of IgH rearrangement coincides with the down-regulation of ckit expression.