Pigmented epithelial cells (PECs) were dissociated from eyes of 8- to 9-day-old chick embryos and were cultured in EdF medium (Eagle's MEM supplemented with dialyzed fetal bovine serum) containing phenylthiourea (PTU) and testicular hyaluronidase (HUase). The PECs rapidly lost melanosomes as they proliferated and dedifferentiated in culture. These dedifferentiated PECs (dePECs) which did not manifest any identifiable specificity could be directed to one of two different differentiated phenotypes; viz., lens or pigment cells, depending upon subsequent culture conditions. Almost all dePECs began to synthesize melanin and redifferentiated to PECs by Day 10 of culture with EdF medium containing ascorbic acid (AsA). In contrast, the sister population of dePECs, when cultured at extremely high cell density with EdF medium containing PTU, HUase and AsA, synthesized °-crystallin which is specific for lens. This transdifferentiation into lens cells occurred by Day 15 of culture. Using this culture system we are able to produce a homogeneous cell population with the potential for synchronous differentiation into either lens or pigment cell phenotype. The system is useful for studying mechanisms involved in cellular metaplasia.