CD38 is a 45,000 molecular weight transmembrane protein that is expressed in immature and mature lymphocytes. However, the expression and function of CD38 during B-cell differentiation in mice is poorly understood. Here, we report that CD38 is expressed from the earliest stages of B-cell development. Pre-pro-B, pro-B, pre-B and immature B cells from murine bone marrow all stained positive for CD38. Interestingly, CD38 expression increases with B-cell maturation. To assess the role of CD38 during B-cell maturation, CD38-deficient mice were analysed. CD38(-/-) mice showed a significant increase in both the frequency of B-lineage cells and the absolute numbers of pre-pro-B cells in bone marrow; however, no other differences were observed at later stages. CD38 cross-linking in Ba/F3 cells promoted apoptosis and marked extracellular signal-regulated kinase (ERK) phosphorylation, and these effects were reduced by treatment with the mitogen-activated protein kinase/ERK kinase inhibitor PD98059, and similar effects were observed in B-cell precursors from bone marrow. These data demonstrate that B-cell precursors in mouse bone marrow express functional CD38 and implicate the early ligation of CD38 in the ERK-associated regulation of the B-lineage differentiation pathway.