An immuno-electron microscopic study performed by a pre-embedding peroxidase-antiperoxidase (PAP) technique revealed S-100 protein reactivity in the cytoplasm and connecting processes of marginal cells of olfactory neuroblastomas. The overlapping cytoplasmic processes of S-100 immunoreactive cells completely surrounded the main membrane-bound granule-bearing tumor cells forming a continuous interface between those tumor cells and fibrous connective tissue. The S-100 immunoreactivity was also observed in the cytoplasm and processes on non-membrane-bound granule-bearing tumor cells within the tumor nodule. The tumor cell nodules and isolated tumor cells were completely surrounded by basement membrane material stainable with anti-laminin antiserum. It appears that the membrane-bound granule-bearing tumor cells of olfactory neuroblastoma are partitioned by basement membrane of S-100 protein-reactive cells and their processes. No S-100 protein-reactive cells were observed within the olfactory epithelium of the two patients with olfactory neuroblastoma. To determine a possible origin of S-100 protein-positive cells, normal olfactory epithelium from six adult patients at autopsy was studied for S-100 reactivity. There were no S-100 protein-positive cells within the normal olfactory epithelium. We discuss the evidence for considering olfactory neuroblastoma a variant of paraganglioma.