Atypical adenomatous hyperplasia (AAH) of the human lung is considered a possible precursor of pulmonary adenocarcinoma. However, its true biological significance remains to be clarified. The authors studied the ultrastructure of AAH in surgically resected lungs and compared it with that of coexisting adenocarcinoma in an effort to define the characteristic features of AAH. Ultrastructurally, AAH possessed oval to irregular nuclei with high nucleo-cytoplasmic ratio and large nucleoli. Development of cytoplasmic organelles was generally poorer in AAH than in adenocarcinoma. However, these differences became less apparent as the degree of atypia of AAH advanced. Both lamellar bodies and electron-dense granules were found in AAH as well as in adenocarcinoma. These results suggest a close relation of AAH with adenocarcinoma of type 2 pneumocyte or Clara cell type. Further, the results of immunohistochemical studies for surfactant apoprotein A, urine protein 1, cytochrome P-450s, CEA, p53, c-erbB-2, Ki67, and bcl-2 well reflected the ultrastructural findings. These results suggest, in accordance with previous studies, that AAH is a lesion closely related to adenocarcinoma. Further, AAH shares some characteristics of type 2 pneumocytes and Clara cells, implying that it might be derived from their common precursor.