In this study, we have correlated cutaneous apoptosis and proliferation in neonatal mice during hair follicle morphogenesis. We have applied a novel triple- staining technique that uses Ki67 immunoreactivity as a marker of proliferation as well as TUNEL and Hoechst 33342 staining as apoptosis markers. We have also assessed the immunoreactivity of interleukin-1 beta-converting enzyme, caspase 1, a key enzyme in the execution of apoptosis, and of P-cadherin, which has been suggested as a key adhesion receptor in segregating proliferating keratinocytes. The TUNEL data were systematically compared with high resolution light microscopy and transmission electron microscopy data. Virtually all keratinocytes of the developing hair bud were strongly Ki67(+), suggesting that the hair bud is not an epidermal invagination but primarily the product of localized keratinocyte proliferation. As hair follicle development advanced, three distinct foci of proliferation became apparent: the distal outer root sheath around the hair canal, the mid outer root sheath, and the proximal hair matrix. Of these proliferating hair follicle keratinocytes only defined subsets expressed P-cadherin. TUNEL(+) cells in the hair follicle were not found before stage 5 of murine hair follicle morphogenesis. During the early stages of hair follicle development, interleukin-1 beta-converting enzyme immunoreactivity was present on all keratinocytes, but virtually disappeared from the proximal hair follicle epithelium later on. High resolution light microscopy/transmission electron microscopy revealed scattered and clustered apoptotic keratinocytes in all epithelial hair follicle compartments throughout hair follicle development, including its earliest stages. This highlights striking differences in the demarcation of apoptotic hair follicle keratinocytes between the TUNEL technique and high resolution light microscopy/transmission electron microscopy and suggests a role for apoptosis in sculpting the hair follicle even during early hair follicle development.