Chronic relapsing experimental allergic encephalomyelitis was induced in Lewis rats by inoculation with guinea-pig spinal cord and complete Freund's adjuvant followed by treatment with low-dose cyclosporin A. In most animals, tail and limb weakness developed in a relapsing remitting pattern but in some these signs were persistent or progressive from onset. Histological studies during the early stages of clinically active disease (less than 25 days after inoculation) revealed inflammation and primary demyelination in the central nervous system (CNS), particularly the spinal cord, and in the peripheral nervous system (PNS), specifically the ventral and dorsal roots and dorsal root ganglia. Animals studied in the later stages of clinically active disease (greater than 28 days after inoculation) had extensive spinal cord demyelination but minimal PNS demyelination. In these animals, large plaques of demyelination with gliosis and prominent plasma cells occurred particularly in the thoracic spinal cord, and lesions of different ages were present within the spinal cord, CNS and PNS remyelination by oligodendrocytes and Schwann cells, respectively, was present in all animals studied later than 18 days after inoculation (the time of the first remission, if it occurred). In both early and late clinically active disease electron microscopy revealed macrophages invading and destroying CNS myelin sheaths. Active demyelination was sometimes found in regions of CNS remyelination, suggesting that remyelinated fibres were being attached. Axonal degeneration occurred in the spinal cord. During clinical remission there was CNS and PNS remyelination and much less inflammation; however, active demyelination still occurred to a limited degree.