Behavioral and biochemical studies have suggested that fetal striatal grafts in the adult rat neostriatum can reverse deficits induced by excitotoxic lesions of the host caudate tissue. In this study, fetal day 17-18 striatal grafts were examined at 2, 5-6, 12, and 44-48 weeks following their implantation into saline- or kainic acid-treated host caudate nucleus in order to compare the neuronal organization of the grafts and the host caudate nucleus and to determine whether the differentiation of graft tissue was influenced by the period of implantation or prior lesion of the host caudate nucleus with kainic acid. Compared to host neostriatum, the grafts at the light-microscopic level lacked bundles of myelinated axons and had neurons that were tightly packed in clusters and rich in Nissl substance. Neurons in the grafts were mostly of medium size, had significantly larger cross-sectional areas, and more frequently exhibited indented nuclei than host caudate neurons. At the electron-microscopic level, grafts 2 weeks following implantation contained many features seen in the normally developing neostriatum, such as growth cones, immature synapses, and degenerating profiles. Grafts appeared mature by 5-6 weeks and contained at least 6 types of neurons and 8 types of axon terminals, which formed synapses with cell bodies, dendrites, spines, and axon initial segments. Both symmetric and asymmetric synapses were found within the grafts. The density of synapses was significantly lower in all the transplants than in host tissue, with the exception of the 5-6 week grafts, where values were statistically comparable to host caudate. A significantly higher proportion of axodendritic synapses was present in the graft neuropil than in the caudate nucleus. The lengths of the synaptic junctions in the grafts were the same as those in the neostriatum. There was little qualitative or quantitative difference in synaptic organization between transplants in kainic acid and sham-lesioned host, with grafts in both host treatment conditions exhibiting the same synaptic density and proportion of axodendritic/axospinous synapses. The development of a high differentiated ultrastructure within striatal grafts is consistent with recent anatomical evidence showing interconnections between striatal grafts and host-lesioned caudate nucleus. Although graft neuropil shows striking similarities in neuronal organization to the caudate nucleus, it also exhibits some distinct differences that may have implications for understanding the functional properties of fetal striatal grafts in animal models of Huntington's disease.