Spontaneously transformed cells in primary hamster-embryo cultures were assayed. Dispersed cells yielded a high percentage of spontaneous, morphologically transformed colonies from the total number of colonies formed. Transformed colonies remained at about the same rate when primary cultures containing transformed cells were passaged, whereas cultures that did not contain transformed cells produced no such colonies when passaged. Embryos of different ages and various embryo organs used as the source of cell cultures failed to yield a higher percentage of transformed colonies. Only cultures of embryo lung produced higher rates of transformed colonies. Horse serum promoted the growth of fibroblast-type cells oriented in parallel arrangement, whereas calf serum inhibited cells of this type. The presence of cells with abnormal chromosomes even in the primary cultures, and particularly in embryo lung tissues, may account for the transformed cells. Also the change of chromosomes from diploid to heteroploid occurred rapidly in the transformed clones after culture in vitro. Cell lines obtained from cloned primary cultures produced tumors in hamsters after short latent periods and with fewer cells than cell lines obtained from uncloned cultures. The cloned cell lines also had generation times and growth potential in vitro that correlated with transplantability in vivo. In one cloned cell line, there was a marked discrepancy between morphological transformation and tumorigenicity.—J Nat Cancer Inst 44: 283-296, 1970.