Immunoglobulin gene rearrangement in avian B cell precursors generates surface Ig receptors of limited diversity. It has been proposed that specificities encoded by these receptors play a critical role in B lineage development by recognizing endogenous ligands within the bursa of Fabricius. To address this issue directly we have introduced a truncated surface IgM, lacking variable region domains, into developing B precursors by retroviral gene transfer in vivo. Cells expressing this truncated receptor lack endogenous surface IgM, and the low level of endogenous Ig rearrangements that have occurred within this population of cells has not been selected for having a productive reading frame. Such cells proliferate rapidly within bursal epithelial buds of normal morphology. In addition, despite reduced levels of endogenous light chain rearrangement, those light chain rearrangements that have occurred have undergone variable region diversification by gene conversion. Therefore, although surface expression of an Ig receptor is required for bursal colonization and the induction of gene conversion, the specificity encoded by the prediversified receptor is irrelevant and, consequently, there is no obligate ligand for V(D)Jencoded determinants of prediversified avian cell surface IgM receptor.The rearrangement of chicken Ig genes generates minimal antibody diversity. At the light chain (L) locus, the unique, functional V L 1 gene rearranges to the unique J L segment in all B cells (1). Similarly, at the heavy chain (H) locus, unique V H 1 and J H genes undergo rearrangement with a family of highly conserved D H elements to form a VDJ H complex of limited diversity (2, 3). Junctional diversity is limited further because of the lack of N nucleotide additions in chicken V(D)J junctions (4). A diverse repertoire of B cell specificities is generated by somatic gene-conversion events in which VD H and V L sequences in functionally rearranged VDJ H and VJ L genes are replaced by homologous sequences from upstream V L and V H pseudogenes (⌿V L and ⌿V H ) (2, 5-7).The bursa of Fabricius is the primary site of B cell lymphopoiesis in avian species, and surgical or chemical ablation of the chicken bursa profoundly disrupts the normal progression of B cell development and the generation of diversity by gene conversion (reviewed in refs. 7-10). The bursa is colonized by a single wave of B cell precursors during embryogenesis starting at about embryonic day 8 (E8) and lasting about a week (11). Within the bursa, B cell precursors first are observed in the mesenchymal tissue, and 20,000-40,000 precursors subsequently migrate across the bursal epithelial basement membrane and begin to proliferate in oligoclonal clusters or epithelial buds from which the discrete follicles of the mature bursa are derived (12, 13).Surface Ig (sIg) ϩ B cell precursors first are observed by about E9-E10, and the frequency of such cells increases rapidly during the embryonic period (14). Although Ig gene rearrangement is not intrinsically biased towar...