The surrogate light chain encoded by the two pre-B cell-specific genes VpreB and λ5 plays a critical role in B cell development of the mouse. It has been shown that targeted disruption of the λ 5gene results in a depletion of B220+ CD43− IgM− pre-B cells in bone marrow, and in a delayed appearance both of CD5+ as well as CD5− surface immunoglobulin (slg)+ B cells in the periphery. In this report we show that DHJH-rearranged B220− and B220+, CD43+, c-kit+, sIgM− pro- and pre-B-I cells with long-term capacity to proliferate in vitro on stromal cells in the presence of interleukin-7 are present in normal numbers in the bone marrow of λ 5T/λ.5T mice at various ages. They express normal levels of VpreB mRNA but, in contrast to normal pre-B-I cells, do not express surrogate light chain on their surface. Pre-B-I cells from fetal liver and bone marrow of λ 5T/λ 5T mice differentiate with normal kinetics and in normal numbers to sIg+, mitogen-reactive B cells. These results suggest that the delayed generation of sIg+ B cells in the peripheral, mature compartments of CD5+ and CD5− cells could be accounted for by the daily production of approximately 5 × 105 sIg+ B cells from the pre-B-I cell pool in the absence of a normal pool of pre-B-II cells.