We examined 2,227 lymph nodes from 100 patients with clinical Stage I cutaneous melanoma for the presence of microscopic deposits of tumor. On examination of hematoxylin-and-eosin-stained sections, none had melanoma. Sixteen nodes from 14 patients had melanoma detectable by an antiserum to S-100 protein in a peroxidase-antiperoxidase (PAP) assay. The melanomatous nature of these cells was confirmed by their reaction with the melanoma-directed monoclonal antibody NKl/C3. The incidence of occult nodal metastases was highest in patients with deeply invasive and micrometrically thick primary tumors. The incidence of occult melanoma was not increased where additional serial sections were cut and semiserial sections examined. Pitfalls in the identification of occult melanoma cells (OMC) include S-100 protein-positive interdigitating dendritic cells, capsular nevus cells, a minority of sinus "macrophages," and the Schwann cells of node-associated nerves. Thus, we conclude that the incidence of early melanoma metastases in the regional lymph nodes of patients with clinical Stage I melanoma is greater than has previously been appreciated on the basis of assessment of routine hematoxylin-and-eosin-stained sections. Six of the 14 patients with OMC died of melanoma (41%), as compared to only 18 of 86 patients without OMC (21%; 0.10 greater than P greater than 0.05).