Processes leading to the recovery of a normal three-layered urothelium from a hyperplastic urothelium induced by cyclophosphamide (CP) treatment in rats have been investigated. A single intraperitoneal (ip) dose of CP caused extensive loss of cells from urothelium, but the remaining cells started to express epidermal growth factor receptor (EGFR) in their plasma membranes. On day 2 after CP injection, proliferating cell nuclear antigen (PCNA) immunohistochemistry showed a rapid increase in positively stained nuclei, from which a hyperplastic urothelium developed, composed of undifferentiated cells expressing EGFR over the entire plasma membrane. Subsequently, EGFR gradually disappeared from the apical plasma membrane but remained in the basolateral membranes. After day 6, PCNA-positive nuclei in all cell layers decreased, except in basal cells. Apoptotic cells were detectable by the TUNEL assay at day 2, and increased in number in all layers of the hyperplastic urothelium until day 10, returning to the control levels by day 14. Electron microscopic evidence showed that apoptotic cells were either pinched off into the bladder lumen or phagocytosed by the neighbouring urothelial cells. Thus, the urothelium responds to the damage by intense proliferation for a week, resulting in an undifferentiated hyperplastic state. Differentiation of superficial cells then begins and damaged cells are gradually removed by apoptosis until the three-layered urothelium is fully restored by two weeks following CP treatment.