Perineurium is a cellular ensheathment protecting the nerve fascicles, i.e., groups of Schwann cell-axon units, in the peripheral nerves. To date, culturing of perineurial (PN) cells has not been reported. Pieces of nerve fascicles from sciatic nerves of adult Wistar rats were used as a source of PN cell cultures. Outgrowth of very large squamous cells was observed from about 90% of the explants. The cells divided slowly and their very large, flattened phenotype and their sheetlike growth patterns were distinct from those of the other connective tissue cells of peripheral nerves, such as Schwann cells or endoneurial fibroblasts. Selected pieces were re-explanted 1 to 10 times and about 1 to 5% of all explants gave rise to cultures which were apparently free from other cell types. They were concluded to be originated from the perineurium according to their light microscopic and ultrastructural properties and their ability to express specific antigens; the cells produced laminin and formed patches of basement membrane material on their surface. These characteristics are not associated with fibroblastic cells and the lack of S-100 protein differentiated the PN cells from the Schwann cells. Furthermore, cultured PN cells expressed fibronectin which is not produced by Schwann cells. PN cells showed characteristically prominent cytoplasmic actin containing stress fibers and staining with antibodies to vimentin showed arrays of intermediate filaments. The cells were negative for cytokeratin, glial fibrillary acidic protein, desmin, and factor VIII-related antigen indicating that they were not related to epithelial, glial, muscle-derived, or endothelial cells, respectively. PN cell cultures maintained their viability up to 5 to 8 passages and did not become overgrown by other cell types. Samples from normal human sciatic nerve and from neurofibromas from patients with von Recklinghausen's neurofibromatosis were cultured as described for rat sciatic nerve. The resulting cultures contained cells which had characteristics resembling those of cultured rat PN cells when studied at the light microscopic level. The present novel method to grow PN cells in cultures provides a possibility to study the specific functions of these cells under conditions not influenced by stimuli from e.g., the axons or the Schwann cells. The present data also provides evidence that PN cells, in addition to Schwann cells and fibroblasts, take part in the formation of neurofibromas.