Grafts of embryonic ventral mesencephalic tissue placed in the striatum of 6-hydroxydopamine-lesioned rats survive, and make and receive connections to and from the host brain. The dopaminergic neurons of the graft can grow processes into the host brain, and thereby alleviate many of the behavioral deficits of this form of experimental Parkinson's disease. However, when examined some weeks after implantation, grafted substantia nigra only contains about 5% of the expected complement of dopaminergic neurons. We have examined the time course of loss of grafted neurons. We find that the majority die during the first 7 days after transplantation. However, we have shown previously that three-dimensional cultures with the same dimensions as a graft, made of identical cell suspensions, have much better dopaminergic neuronal survival. There must, therefore, be features in the environment surrounding a graft that are toxic to dopaminergic neurons. A limiting factor in the efficacy of dopaminergic grafts is the small distance over which the neurons are able to grow neurites and form connections in the host brain. We find that the growth of neurites from dopaminergic neurons into the host striatum occurs in two phases. Neurites reach their maximum length within 7 days of transplantation, and this is followed by a much slower process of branch and terminal formation. Since axon growth in the adult brain may be inhibited by a number of factors associated with reactive gliosis, we have immunostained various ages of graft for vimentin, tenascin, chondroitin sulfate proteoglycan (CS-PG) using the CS56 antibody, the DSD-1 proteoglycan, and microglia using the OX-42 antibody. We have compared this staining with that surrounding a simple stab wound. Vimentin staining was initially seen in the graft and in astrocytes immediately surrounding it. By 7 weeks staining was restricted to a ring of astrocytes surrounding the graft. Tenascin, DSD-1, and CS-PG were initially seen in and around the grafts. By 7 weeks they had disappeared from grafts, but CS-PG and tenascin persisted in small amounts around stab wounds. In general, immunostaining of these molecules persisted longer around a stab lesion than around a graft. There was also an intense local microglial reaction surrounding both grafts and stab wounds which had largely resolved by 7 weeks.