The differentiation of AChE-positive cells in embryonic neural grafts from various brain regions into the hippocampus after fimbria-fornix transection was investigated. Rat fetal cell suspensions of basal forebrain, hippocampus, mesencephalon or cortex were prepared from fetuses of either embryonic day 14 (E14) or day 19 (E19) gestational age, and these were transplanted into the rat brain after unilateral fimbria-fornix transection. Dense acetylcholinesterase (AChE) positive fibres were observed in both E14 and E19 basal forebrain grafts. These fibres were also found in E14 hippocampal grafts. However E19 hippocampal grafts did not have any AChE-positive fibres. These results suggest that E14 hippocampal grafts might be affected by the host brain tissues and differentiate into cholinergic neurones.