Bone marrow-derived cells (BMDCs) can engraft as epithelial cells throughout the body, including in the lung, liver, and gastrointestinal (GI) tract following transplantation into lethally irradiated adult recipients. Except for rare disease models in which marrow-derived epithelial cells have a survival advantage over endogenous cells, the currently attained levels of epithelial engraftment of BMDCs are too low to be of therapeutic benefit. Here we tested whether the degree of bone marrow to epithelial engraftment would be higher if bone marrow transplantation (BMT) were performed on 1-day-old mice, when tissues are undergoing rapid growth and remodeling. BMT into newborn mice after multiple different regimens allowed for robust hematopoietic engraftment, as well as the development of rare donor-derived epithelial cells in the GI tract and lung but not in the liver. The highest epithelial engraftment (0.02%) was obtained in mice that received a preparative regimen of two doses of busulfan in utero. When BMDCs were transplanted into myelosuppressed newborn mice that lacked expression of the cystic fibrosis transmembrane conductance regulator (CFTR) protein, the chloride channel that is not functional in patients with cystic fibrosis, the engrafted mice showed partial restoration of CFTR channel activity, suggesting that marrow-derived epithelial cells in the GI tract were functional. However, BMT into newborn mice, regardless of the myeloablative regimen used, did not increase the number of bone marrow-derived epithelial cells over that which occurs after BMT into lethally irradiated adult mice.