The hormone-responsive R3230AC mammary carcinoma, serially transplantable in Fisher rats, shows striking functional and morphological similarities to the normal mammary gland. We have studied its cellular composition by both light and electron microscopy, employing markers of myoepithelial and epithelial cells. We identified two cell types: the major cellular component corresponded to epithelial milk-protein secreting cells, while a second component showed immunocytochemical and ultrastructural characteristics of the myoepithelial cells. These cells were positive with a monoclonal antibody detecting alpha smooth muscle actin. The dual differentiation which normally occurs in breast ducts is therefore reproduced in a malignant experimental tumor. The coexistence of neoplastic cell populations, divergent in morphology and function, that persist in a tumor despite many transplant generations, leads to reconsideration of the relationship between cellular differentiation and malignant transformation.