To investigate the clonal relationship between follicular lymphoma (FL) and transformed diffuse lymphoma (tDL), we examined the expression of tumor idiotype, immunoglobulin (Ig) gene rearrangements and sequence of Ig variable genes in paired tissue specimens. All 16 cases analyzed expressed surface immunoglobulin (sIg) on both the FL and the tDL, though the immunophenotype of one case of FL could not be definitively determined. In 14 of 15 cases, the surface immunophenotype was preserved; the exception was likely secondary to a class switch from IgM to IgG. In 12 of 13 cases, antiidiotypic monoclonal antibodies prepared against the FL reacted with the paired tDL. Analysis of Ig gene rearrangements in four cases by Southern blot hybridization showed evidence of clonal relationships in all cases though concordance was not seen with all probes tested (C kappa, C lambda, JH, PFL1, and PFL2). In the one case that had a discordant L chain rearrangement, sequence analysis of the L chain demonstrated a common mature B cell origin for both the FL and tDL. To determine whether tDL arose from one or more FL cells, the sequences of the H chain variable genes were analyzed. Individual clones of the V region gene of the FL showed a random distribution of changes throughout the sequence. In contrast, individual clones of the V region gene from tDL shared numerous nonrandom sequence alterations, implying a common single cell origin. In conclusion, tDL is a mature B cell and arises by transformation of a single FL cell.