We prospectively examined the frequency of the t(12;21)TEL-AML1 fusion in 504 children with newly diagnosed standard risk ALL using RT-PCR assays. Cells from 95 patients (18.8%) were TEL-AML1+. There was a significantly higher frequency of pseudodiploidy among the TEL-AML1+ cases (39.4% versus 14.1%, P = 0.001), primarily because structural abnormalities involving 12p and del(6q) occurred more frequently in the TEL-AML1+ group. TEL-AML1+ ALL was more sensitive to the induction chemotherapy than TEL-AML1- ALL. The percentage of "rapid early responders", i.e., patients who achieved an M1 (< 5% blasts) or M2 (5-25% blasts) marrow status on day 7 of induction chemotherapy, was significantly higher among TEL-AML1+ cases. The quality of remission of RT-PCR positive cases was excellent, as evidenced by the very low to absent MRD burden of their end-of-induction bone marrow specimens. TEL-AML1+ patients also had an excellent early EFS outcome. The probability of EFS at 30 months from study entry were 98.9 +/- 1.0% for the TEL-AML1+ group and 92.1 +/- 1.5% for the TEL-AML1- group (P = 0.0001). This prospective study significantly expands the knowledge gained from previous studies regarding the prognostic significance of t(12;21)TEL-AML1 fusion in pediatric ALL.