To determine the potential prognostic value of epithelial cadherin (E-cadherin), a Ca(2+)-dependent cell-cell adhesion molecule, we have analysed its immunoreactivity and cellular localisation in 67 transitional cell carcinomas (TCC) using an avidin-biotin immunoperoxidase technique on formalin-fixed, paraffin-embedded tissues. These results were correlated with histopathological grade, tumour stage, presence of metastases and survival. In addition, 10 cystitis and 11 normal bladder biopsies were evaluated as controls. E-cadherin was expressed in a normal membranous pattern in all normal and 7 of 10 cystitis biopsies. Loss of normal surface E-cadherin expression was found in 3 of 15 superficial tumours and in 48 of 52 invasive cancers. Abnormal immunoreactivity was strictly related to tumour differentiation and stage. Fifteen of 20 well-differentiated (grade I) tumours showed preserved membranous E-cadherin immunoreactivity, while 46 of 47 moderate and poorly differentiated tumours (grades II and III) demonstrated abnormal staining patterns. Loss of membranous E-cadherin immunoreactivity was also associated with advanced tumour stage. There was a significantly higher 5-year survival rate for patients with preserved membranous staining compared with patients with abnormal staining.