The mouse uterus during pregnancy contains a large population of lymphoid cells termed granulated metrial gland (GMG) cells. Our observations suggest that these cells are highly activated cytolytic lymphocytes related to NK or lymphokine-activated killer cells. Immunostaining demonstrated asialo GM1 and Thy-1 on GMG cells, both of which are expressed by NK cells. Decidua basalis tissue and isolated GMG cells contained three proteins that are characteristic of activated cytolytic lymphocyte granules: perforin, serine esterase 1, and serine esterase 2. These mediators were demonstrated in GMG cells by Western blot analysis using polyclonal antisera and by Northern blot analysis using specific cDNA probes for their mRNA. The proteins were not detected in normal spleen or liver or in asialo GM1+ cells isolated from those organs, consistent with the absence of these mediators from resting cytolytic cells. The amount of perforin in GMG cells was similar to that present in cloned, IL-2-stimulated, CTL shown previously to contain a large amount of this protein. A large population of NK cells bearing the surface marker LGL-1 was demonstrated at the implantation site by labeling with monoclonal antibody 4D11, but T cells were not detected. Many LGL-1+ cells at the implantation site expressed the GMG cell markers asialo GM1, Thy-1, and perforin. Staining intensities were inversely correlated, with LGL-1-bright cells showing little or no staining of GMG cell markers and LGL-1-faint cells showing more obvious staining of GMG cell markers. This suggests that LGL-1+ NK cells may differentiate in situ to GMG cells, losing LGL-1 and gaining a high concentration of GMG cell markers in the process. Activated cytolytic cells related to NK or lymphokine-activated killer cells may function in the pregnant rodent uterus to intercept and kill aberrant placental or embryonic cells that might otherwise enter the female and proliferate.