Our objective was to determine prognostic factors and the role of prophylactic lymph node dissection in Merkel cell cancer. A retrospective chart review of 15 patients from Loma Linda University Medical Center, Loma Linda, and Kaiser Permanente, Fontana, was used. The most important predictor of survival was presence of lymph node metastasis (P = 0.03). Lymph node metastasis was the first sign of recurrence in 60 per cent of patients and preceded distant metastasis. Age at presentation, tumor size, and location had no influence on survival. Gross presurgical determination of tumor extent was misleading. Microscopically positive margins necessitated reexcision in 60 per cent of patients. Local recurrence occurred in 27 per cent of patients. Recurrence at lymph node basins was lower in patients with elective lymph node dissection (0%) compared with therapeutic node dissection (57%)(P < 0.05). Incidence of micrometastases in patients undergoing prophylactic lymph node dissection was 100 per cent. No difference in survival was seen between prophylactic and therapeutic node dissection. Because Merkel cell cancer spreads in a "cascade" fashion, elective node dissection may provide a chance for a cure. Elective node dissection provides better locoregional control compared with therapeutic node dissection and helps to determine prognosis.