In the past two decades, testicular tissue grafting and xenografting have been well established, with the production of fertilization-competent sperm in some studies. However, few studies have been carried out to observe the development of grafted prepubertal testicular tissue of rats and compare the biological differences between in situ testis and grafted testis. In this study, we established the prepubertal testicular tissue xenografting model using a 22-day-old rat and evaluated certain parameters, including testicular histology, testosterone production, and ultrastructure of the grafted testes. We also assessed gene expression of cell proliferation markers, testicular cell markers, and antioxidative defense system. Our results showed that 47 days after transplantation, intratesticular testosterone concentration was not significantly altered; however, cell proliferation, spermatogenesis, and Sertoli cell markers in the transplanted testes were significantly disrupted compared with the control group, accompanied by aggravated apoptosis and oxidative damage. Moreover, the transplanted testes showed smaller tubular diameter and disrupted spermatogenic epithelium with apparent vacuoles, distorted and degenerated germ cells with obscure nuclear margin, and no spermatids in the center of the tubules. Although testis xenografting has been extensively tested and attained great achievement in other species, the prepubertal rat testicular tissue xenografting to immunodeficient mice exhibited obvious spermatogenesis arrest and oxidative damage. The protocol still needs further optimization, and there are still some unknown factors in prepubertal rat testes transplantation.