BACKGROUND: Human prostatic epithelium consists mainly of basal and secretory luminal cells: the origin of these phenotypes from a common stem cell, within the basal compartment, has been proposed but not yet demonstrated. METHODS: Analyses by light and electron microscopy, immunocytochemistry, and flow cytometry were used to determine lineage. The criteria for identifying the different phenotypes were characteristic morphology, and organization and expression of luminal- and basal-specific markers. RESULTS: After organoids attached, outgrowths appeared with cells maintaining close cell-to-cell associations. The dividing cell compartment contained a subpopulation of cells with stem-cell characteristics and a major population that may correspond to amplifying cells. The characteristics of the stem-cell phenotype included reactivity with antibodies CKbasal, CK14, and Ki67. The amplifying cells were characterized as an intermediate phenotype between basal and luminal, as reactivity was demonstrated with CKbasal, CK14, and CK18. As outgrowths eventually merged, multilayering was apparent and cells on the uppermost layer had numerous secretory vacuoles and reacted strongly with antibodies CK18 and CK19, androgen receptor, and prostate-specific antigen, which is characteristic of secretory luminal cells in vivo. In passaged cultures, loss of reactivity with CKbasal was detected; we postulate that this population contains the stem-cell fraction. CONCLUSIONS: These findings demonstrate that basal and luminal cells are of the same lineage and are derived from a common stem cell. Moreover, the progenitor stem cells reside within the basal compartment.