Administration of diethylnitrosamine p.o. to female Sprague-Dawley rats induces hepatocellular lesions antecedent to hepatocarcinoma (altered foci and hyperplastic nodules). We have tested hepatocytes from hyperplastic nodules for their invasiveness in vitro, which is a marker for malignancy. The hyperplastic nodule cells are compared with control liver cells and hepatocarcinoma cells. Control liver tissue and the hepatocarcinoma are collected as fragments taken directly from the rat liver. Nodules, on the other hand, isolated by collagenase perfusion of the liver, are collected on a filter. The fragments of normal liver, the nodules, and the hepatocarcinomas were brought in contact with precultured 9-day-old embryonic chick heart fragments for attachment to each other to form confronting cultures. After attachment, the confronting cultures are incubated at 37 degrees on a gyratory shaker for 24 hr to 14 days. Hepatocytes from the nodules show progressive invasion into the precultured heart fragments in the same way as the hepatocarcinoma cells after 3 to 14 days in vitro. The control hepatocytes from the liver fragments showed no invasion. We conclude from these observations that the cells of the nodules must be considered as malignant altered hepatocytes, for they show progressive invasiveness in vitro.