The toxic effects produced by 2,3,7,8-tetrachlorodibenzo-p-dioxin (TCDD) and its congeners include inhibition of lymphoid development. We have previously found an inhibition of B-cell development in the bursa of Fabricius of chick embryos treated with TCDD congeners in ovo. In the present study, the bursae of ten-day-old chick embryos were removed and cultured on filter paper for 24 hr in media with or without TCDD or 3,3',4,4'-tetrachlorazoxybenzene (TCAOB). Following culture, the bursae were transplanted onto the chorioallantoic membrane (CAM) of ten-day-old eggs of the same strain or of a strain expressing a different B-cell surface alloantigen. After 5 days on the CAM the number of B-cells was determined or the grafts were sectioned for subsequent immunohistochemistry. Results were as follows: 1) A lower number of lymphoid cells (dose dependent) was observed in the TCDD-treated transplants amounting to 40-50% of that in the controls at 10(-9) M TCDD. Higher concentrations of TCDD compromised survival of the grafts. A single concentration of TCAOB (10(-8) M) was tested, resulting in a lymphoid cell number of 60% of that of the controls. 2) The bursal epithelium showed relatively normal development even in cases where B-cell development was affected. 3) Lymphoid cells in the grafted bursae originated from the embryo of the host egg. These findings suggest that the TCDD congeners had a direct effect on the bursa of Fabricius, leading to an inhibition of lymphoid development. It is likely that the microenvironment is affected by these compounds, thus resulting in a decrease in the attraction of stem cells and/or in the capacity to induce proliferation of the colonizing cells.