The development of an in vivo system for investigating osteoclast differentiation is important because molecular events occurring in vivo can be observed during the differentiation of the authentic osteoclasts. In adjuvant arthritic rats, an experimental model of human rheumatoid arthritis, extensive bone resorption is observed in the distal diaphysis of the tibia. In the area of extensive bone resorption, it is always accompanied with clusters of numerous multinucleated giant cells (MGCs) as well as bone-resorbing osteoclasts. Here we characterized the morphological properties of these MGCs with the use of enzymehistochemical and immunohistochemical techniques. Extensive destruction but also a marked formation of the inner and outer bone surfaces were the predominant features in the tibiae of such arthritic rats 4 weeks after the adjuvant injection. Numerous MGCs were frequently clustered in the bone marrow spaces located apart from the bone matrices. Although the MGCs lacked ruffled borders, these cells were rich in mitochondria and vacuoles. These multinucleated cells revealed a positive reaction for tartrate-resistant acid phosphatase but a negative reaction for non-specific esterase staining. Most of these MGCs expressed the Kat 1-antigen, an immunological marker specifically expressed on the cell surface of rat osteoclasts. In a dentin resorption experiment using a cluster of MGCs excised from the bone marrow tissues of the tibial distal diaphyses of rats with adjuvant arthritis, many resorption lacunae were formed on dentin slices after a 3-day culture. These results suggest that the majority of the MGCs are osteoclasts but not macrophage polykaryons.