Myelodysplastic syndrome (MDS) in childhood is considered to be very rare and detailed pathobiological data are scarce. More biological information regarding MDS in children is clearly needed and in vitro culture studies provide one possibility for gaining further pathophysiological insights into this malignancy. Here, we incubated bone marrow samples from 30 children with MDS in liquid suspension culture in order to grow the transformed cells in vitro. In most cultures, the hematopoietic cells died quickly and only fibroblastic (stromal) background layers proliferated temporarily; several normal Epstein-Barr virus (EBV)-transformed B-lymphoblastoid cell lines (B-LCL) were established. Only in one instance, albeit from the peripheral blood and not from the bone marrow, could we establish a cell line, termed MUTZ-1, from the malignant cells of a 5-year-old girl with MDS (FAB subtype refractory anemia with excess of blasts). The MDS arose from a pre-existing Fanconi anemia and progressed quickly to an acute myeloid leukemia (FAB M2). Despite positivity for EBV, MUTZ-1 is not an EBV + B-LCL and further characterization of MUTZ-1 confirmed the derivation from the transformed clonal cells. Immunophenotyping showed a pre B-cell surface marker profile (CD10+ CD19+ cytoplasmic IgM+); receptor gene rearrangement analyses underlined the clonal B-cell nature of MUTZ-1 cells. MUTZ-1 cells exhibit a highly rearranged, unstable karyotype with a high frequency of spontaneous chromatid breaks and exchanges; del(5q) and additional rearrangements involving chromosome 5 [der(15)t(5;15)] were detected. The present data and results from a few other MDS-derived cell lines suggest that the transforming event in MDS seems to occur in an immature pluripotent progenitor cell. The new MDS-derived continuous cell line MUTZ-1 provides a useful in vitro model system for studies on the pathogenetic events leading to MDS.