A lung, which was surgically removed from a patient who had oat cell carcinoma, contained multiple tumorlets and showed extensive Kultschitsky-type cell proliferation of bronchial and bronchiolar mucosa. On the basis of light and electron microscopic observations, it is shown that pulmonary tumorlets arise from focal areas of bronchial and bronchiolar Kultschitsky cell proliferation which may advance to luminal obliteration. Involvement of the pulmonary parenchyma takes place by extension of these newly proliferated cells along the terminal branches of the bronchiolar tree or by penetration of the bronchial or bronchiolar wall; the latter process evokes a striking proliferation of connective tissue which forms the matrix in which the cells of some fully developed tumorlets are embedded. Because of striking morphologic similarities between tumorlets and spindle cell carcinoid tumors, and the proven origin of tumorlets from pulmonary Kultschitsky-type cells, it is suggested that the more complete and histogenetically acceptable term "carcinoid tumor-let" be used to distinguish this lesion from other forms of epithelial proliferations in the lung.