One hundred and sixty-one evaluable patients with biopsy-confirmed transitional cell carcinoma of the bladder were studied in a cooperative protocol comparing intravesical BCG and adriamycin. Patients have been followed for 2-25 months (median 15.7 months) with cystoscopy at 3-month intervals, urinary cytology, and bladder biopsy. Sixteen of 88 patients (19%) who received BCG immunotherapy developed tumor recurrence compared with 45 recurrences (54%) in the 83 patients who received adriamycin chemotherapy (p less than 0.001, chi 2). Eighty-nine of the randomized patients had documented carcinoma in situ. The complete response rate in 41 patients with carcinoma in situ who received BCG was 85%, compared with a complete response rate of only 39% in 46 patients who received adriamycin (p less than 0.001, chi 2). These data suggest that BCG immunotherapy is superior to adriamycin chemotherapy in the prevention of recurrent superficial transitional cell carcinoma and the treatment of in situ carcinoma of the urinary bladder.