Malignant transformation of human cells is associated with morphological and biochemical alterations. We have studied the distribution and pattern of staining of HMFG2 (human milk fat globulin) in normal breast, benign breast lesions, and 137 primary and metastatic breast carcinomas. Immunohistochemical staining was performed with an antibody to HMFG2 using the indirect peroxidase technique. Three patterns of staining were noted: 1) secretion and luminal staining (in normal breast, most benign breast lesions and some breast carcinomas); 2) plasma membrane staining (in breast carcinomas); 3) intracytoplasmic staining (in breast carcinomas). Immunoelectron microscopy was also performed on normal breast, infiltrating duct, and lobular carcinomas. Immunoelectron microscopy showed localization of the gold particles on the electron dense granules of the HMFG2 protein. These were localized along the surface of the extracytoplasmic lumina in normal breast ducts/acini and breast carcinomas, whereas localization was also noted within the intracytoplasmic lumina in cancer cells only. These results show that there is altered localization of milk fat globulin in breast cancer cells associated with membrane internalization and formation of intracytoplasmic lumina. This contributes to the understanding of the phenotypic alterations associated with malignant transformation in breast cancer.