There is considerable current interest in stem cells, not only in order to understand the processes of development, regeneration, and carcinogenesis but also because readily accessible tissues such as the skin may be an excellent resource of autologous stem cells to treat human disease (Baksh et al, 2004). Cells that mature into functionally different lineages have been described in the skin (Taylor et al, 2000; Albert et al, 2001; Potten and Booth, 2002; Jahoda et al, 2003; Trempus et al, 2003; Dyce et al, 2004). For example, skin-derived precursor cells have been described that can differentiate into neurons, muscle, and adipocytes (Toma et al, 2001). With the exception of keratinocyte and melanocyte stem cells, the origin and characteristics of skin stem cells are, however, not well defined. Stem cell antigen-1 (Sca-1; Ly-6A/E) is a well-established marker for bone marrow-derived murine stem cell enrichment for both hematopoietic and mesenchymal stem cells (Patterson et al, 2000; Baddoo et al, 2003; Bonyadi et al, 2003) but has been little investigated in skin. We have identified in neonatal mouse skin a major population of Sca-1þ cells that do not express c-kit or CD45 but that express adipocyte markers. A preliminary report of this study has been made. 1

Sca-1 visualized by immunohistochemistry in neonatal skin showed positive staining cells in the lower dermis, in the sebaceous glands, and in the panniculus adiposus of the hypodermis (Fig 1A, C; for methods, see Supplementary data and Table S1). It was unexpected to find such a large population of Sca-1þ cells in the skin, since in the bone marrow, less than 1% of cells are positive for Sca-1. Double staining with antibodies to the stem cell marker CD34 indicated the Sca-1þ cells in the lower dermis and sebaceous glands were mostly negative for CD34, whereas Sca-1þ CD34þ cells positive for both markers were readily identifiable in the panniculus adiposus (Fig 1A). Further, CD34þ cells that did not express Sca-1 were found chiefly in the upper dermis (Fig 1A). Since adipocytes are a major component of the lower dermis and the panniculus adiposus, skin sections were stained with red oil that visualizes fat and also with an adipocyte-specific antibody to fattyacid binding protein 4 (FABP4, Ap2)(Fruhbeck et al, 2001)(Fig 1B, D). Red oil staining, indicating the presence of fat, was readily observed in the lower dermis and in the