The expression of the alpha-fetoprotein (AFP) gene in hepatocellular carcinoma (HCC) and liver cirrhosis by in situ hybridization analysis of AFP mRNA in cryostat and paraffin-embedded tissue sections was studied. In HCC sections the majority of tumor cells showed positive hybridization with a 3H-labeled AFP complementary DNA probe. The number of radioactive hybrid grains detected in HCC sections generally paralleled the level of serum AFP in the patient. In liver cirrhosis sections a small number of cells showed positive hybridization. These cells were dispersed in the tissue and morphologically indistinguishable from surrounding hepatocytes. Each of these cells contained a high level of hybridization signals to permit easy identification. In situ hybridization analysis of AFP mRNA may be of use in detecting preneoplastic cells in liver cirrhosis that cannot be defined on the morphologic and immunohistochemical basis.