While it is generally agreed that in the lymphoid differentiation of B lineage cells there is no stage in which cell-surface immunoglobulin (sIg) and terminal deoxynucleotidyl transferase (TdT) are expressed simultaneously, a few B cell acute lymphoblastic leukemia (B-ALL) cases with this phenotype have been reported. Two such cases and the derived cell lines are reported here, in which the expression of recombination activating gene-1 (RAG-1) was also detected. One case was a CD19+ CD22+ HLA-DR+ sIg+ (gamma, kappa) B-ALL. The cell line (Bay9I) also expressed CD10. Karyotypic analysis revealed t(14;18)(q32;q21) and additional aberrations. In the other case, the fresh leukemia cells expressed CD19, CD24 and HLA-DR antigen. The derived cell line (Tree92) also expressed CD22 and sIg (mu, lambda). The karyotype of the Tree92 cells was t(8;14)(q24;q32) with additional aberrations. Tree92 is the first established cell line having both t(8;14)(q24;q32) and TdT. TdT was detected by Northern blotting as well as indirect immunofluorescence analysis. In addition, both Bay9I and Tree92 expressed RAG-1, as detected by Northern blot analysis. Cross-linking of sIg on Tree92 cells with anti-mu antibody led to significant down-regulation of RAG-1 expression. It seems that there is a sIg+ TdT+ RAG-1+ B lineage differentiation stage, and that signaling through sIg can modulate RAG-1 expression.