The microphthalmic mouse (mi) possesses a 3-bp deletion of the Mi gene that alters the DNA binding site of the transcription factor gene product. This animal has diminished numbers of NK and mast cells (MC) and is osteopetrotic due to a lack of the normal complement of functional osteoclasts. The reduction of MC has been proposed to be due to the lack of adequate c-Kit expression that is required for MC differentiation. However, data from other labs has questioned this interpretation. In this report, we present data suggesting bone marrow-derived deficiencies of the mi mouse are not due to a lack of c-Kit expression and function, but instead due to an inhospitable environment within the bone marrow itself. Specifically, we have found that such animals also lack virtually all B cell precursors within the marrow and rely upon other lymphatic sites, such as the spleen, for B cell development and maturation. Although the animal has depressed numbers of NK cells, B cells, and MC, it still possesses a normal thymus and peripheral T cells. Therefore, the block in cellular differentiation must be within the marrow environment, which is essential for maturing B cells, NK cells, and MC but not T cells.