Most fetal rat brain cells expressing the embryonal, highly sialylated form of the cell adhesion molecule N-CAM (E-N-CAM) are precursor cells, as judged from the absence of marker molecules specific for mature neural cell types. However, the detection of E-N-CAM+ cells in frozen sections does not provide information on the lineage-specific differentiation of these cells during development. To investigate their differentiation behaviour in vitro, E-N-CAM+ cells were isolated at different times of brain development by fluorescence-activated cell sorting (FACS), using a monoclonal antibody (Mab RB21-7) which specifically recognizes polysialic acid (PSA) residues on E-N-CAM. Double-immunofluorescence analyses showed that the majority of E-N-CAM+ cells isolated on prenatal days 15 to 18 differentiated into neurons while a small subset of Mab RB21-7 binding cells proved to be astrocytic precursors and/or bipotential. The proportion of E-N-CAM+ astrocytic precursors increased during later development (prenatal day 22) concomitantly with the onset of gliogenesis. While conversion of E-N-CAM to mature forms of N-CAM was never observed in neurons during cultivation, E-N-CAM+ cells of the astrocyte lineage switched to N-CAM soon after the onset of GFAP expression. A lineage-specific transition of E-N-CAM to mature N-CAM expression is, therefore, suggested for these astrocytic progenitor cells during rat brain development.