We assessed the functional properties and the kinetic status in vitro, and the engraftment potential in vivo of human haematopoietic stem cells according to the expression of CD34 antigen. Lin-CD34- and Lin-CD34+ cells were isolated from granulocyte colony-stimulating factor-primed peripheral blood (PB) cells of healthy donors. The CD34- cell fraction did not contain either clonogenic cells in semisolid culture or long-term culture initiating cells (LTC-IC). However, stroma-dependent liquid cultures and cytokines induced CD34 expression on a minority of stem cells, acquisition of clonogenic capacity and generation of LTC-IC. Significantly higher percentages of quiescent G0 cells and lower percentages of cycling G1 cells were found in Lin-CD34- cells when compared with Lin-CD34+ cells. Kinetic quiescence of Lin-CD34- cells was associated with a significantly higher expression of the negative regulators of the cell cycle, p27Kip1 and p21(cip1/waf1). Cytokine-mediated induction of CD34, in vitro, resulted in cycling of stem cells and downregulation of p27. There was a higher rate of human long-term engraftment in immunocompromised non-obese diabetic (NOD)/recombination activating gene 1null and NOD/severe combined immunodeficient-beta2microglobulin(null) mice injected with CD34+ cells. Thus, our study indicated that CD34 expression on human PB stem cells was associated with haematopoietic activity, cell-cycle recruitment and downregulation of p27Kip1 in vitro and higher engraftment capacity in vivo.