The olfactory epithelium is remarkable for the persistence of multipotent, neurocompetent progenitor and stem cells throughout life that can replace all of the various cell types of the epithelium following injury. The therapeutic exploitation of the neurocompetent stem cells of the adult olfactory epithelium would be facilitated by the development of a culture system that maintains the in vivo potency of the progenitors while they are expanded and/or manipulated. We have used an air-liquid interface culture protocol, in which a feeder cell layer of 3T3 cells is established on the underside of a culture insert and FACS-isolated or unsorted progenitor cells from the methyl bromide-lesioned adult rodent epithelium are seeded on upper side. Under these conditions, epithelial cells other than HBCs are capable of organizing themselves into complex 3-dimensional, epithelium-lined spheres, which can be passaged. The spheres contain cells with the molecular phenotype of globose basal cells, horizontal basal cells, sustentacular cells and neurons. Spheres derived from mice that express the green fluorescent protein constitutively can be dissociated after 6 days in vitro and directly transplanted into the epithelium of wild type, methyl bromide-lesioned mice via nasal infusion. The resulting clones contain the various cell types observed in aggregate when globose basal cells are transplanted acutely. In contrast, the same cells cultured as two dimensional, submerged cultures undergo fibroblastic transition after transplantation and do not integrate into the epithelium. In conclusion, the culture system described here maintains the potency of progenitors, which can then participate in epitheliopoiesis in vivo.