The distribution of XX and XY cells in XX—XY chimaeric mouse testes was analysed by enzyme marker analysis of separated testicular tissues and by in situ DNA marker analysis of air-dried testicular cells and testis sections. XX cells contributed to the Leydig cells, the peritubular cells and the vascularized connective tissue of the tunica albuginea. The Sertoli cells, on the other hand, appeared to be exclusively XY. These results indicate that during the development of the testis, Sertoli cell differentiation is triggered by cell-autonomous activity of the Y chromosomal testis-determining gene Tdy. Subsequent steps in testis differentiation may be a consequence of Sertoli cell activity.