Between 1986 and 1988 the annual incidence of invasive melanoma in the Hunter area of New South Wales, Australia, almost doubled to 52.5 per 100,000 in men and 42.9 per 100,000 in women. These rates have been maintained and are similar to those reported for 1987 in Queensland, Australia, which are the highest in the world. Most of the increase in incidence was in melanomas less than 1,50 mm in thickness, and adults of both sexes and all ages were affected. Thicker melanomas also increased in incidence but only in adults 45 years and older, and mainly in men. An analysis of health insurance data on treatment of skin lesions and data from a histopathology laboratory suggested that diagnosis and treatment of skin lesions generally in the Hunter area had increased almost 2-fold over this period. Advancement of the time of diagnosis and a real increase in incidence were likely explanations for some of the observed trends. Increasing diagnosis of a non-metastasising form of thin melanoma, consequent upon increasing removal of pigmented skin lesions by medical practitioners, may also explain some of the observed increase in the incidence of the disease. This possibility has important implications for proposed population screening programs, and methods are needed to distinguish such lesions, if they exist, from potentially fatal melanoma.