Fetal liver transplantation has been shown to induce hematological and immunological reconstitution in irradiated rodents, dogs, horses, and sheep. Engraftment and reconstitution without GvHD has been readily obtained using histocompatible donors. When mismatched fetal donors were used, a comparatively larger number of donor cells was required, in addition to pre-treatment of host with higher doses of irradiation or irradiation plus chemotherapy. Stem cell suspensions devoid of any T lymphocyte can be transplanted across major histocompatibility barrier without inducing overt GvHD. The transplanted animals become tolerant to both donor and host grafts.