The validity of permeabilized cells as a model of DNA and RNA synthesis was studied with the use of mouse S-49 lymphoblastoma cells rendered permeable by exposure to L-alpha-lysophosphatidylcholine. The permeabilized cells readily incorporated exogenously supplied cytosine and uracil nucleotides into HClO4-insoluble macromolecular material. However, the incorporation of these tracers did not require the three other complementary nucleotides, and adenine, guanine or thymine nucleotide tracers were incorporated at much lower rates. These results, which were also obtained with permeabilized Abelsohn-leukaemia-virus-transformed mouse macrophages, mouse neuroblastoma cells and S-49 lymphoblastoma homogenates, are inconsistent with semi-conservative DNA replication or RNA transcription; rather, they suggest the involvement of terminal nucleotidyltransferase(s) that mediate the incorporation of uracil and cytosine nucleotides. DNA synthesis was restored when permeabilized cells or cellular homogenates were supplemented with denatured salmon testes DNA. These results suggest that endogenous cellular DNA is impaired in its function as a template for DNA replication and transcription in vitro. Metabolic channelling or compartmentation of nucleic-acid-precursor pathways could not be demonstrated in the permeabilized cells.