Terminal deoxynucleotidyl transferase (TdT) was examined in mononuclear peripheral blood cells (pB) and bone marrow (BM) specimens of 63 children with acute leukemia (AL). The enzyme activity in normal specimens (pB, BM) was below 0.2 U/10(8) cells; whereas, 49 of the 52 children with acute lymphoblastic leukemia (ALL) at diagnosis showed an activity in the range 1.2--60 U/10(8) cells. 2 of the remaining 3, devoid of TdT activity, were found to be B-cell leukemia. Patients with acute non-lymphoblastic leukemia (ANLL) were generally TdT-negative. Elevated level of TdT activity was detected in only one of 11 children with ANLL. In one patient with acute leukemia two distinct populations of cells with lymphoblastic (87%) and myeloblastic characteristics were evident. The clinical course and cell marker studies were consistent with the interpretation of a defect at the level of the common stem cell giving rise to a TdT-positive lymphoblastic cell population at diagnosis and, following the initial ALL-therapy (4 weeks), a predominant TdT-negative myeloblastic population. TdT as a marker for the modulation of chemotherapy was examined in the remission phase of the disease. Of the nine patients in the first 3 months of remission, one was found to have elevated level of TdT activity (2.5 U/10(8) cells). These data define the usefulness of TdT in the classification of acute leukemia.