The outer root sheath contains a heterogeneous cell population including keratinocytes expressing keratins 5 and 14, keratinocyte and melanocyte stem cell progeny migrating downward to the hair matrix, and differentiating melanocytes [26-29]. Between the insertion of the arrector pili muscle and duct of the sebaceous gland the outer root sheath forms a distinct bulge, which has been identified as a reservoir of multipotent stem cells [30]. These cells are biochemically distinct and can be identified by long-term retention of BrdU or by immunodetection of cytokeratins 15 and 19, CD 34 (in mice), and CD 200 (in humans) [31-34]. In addition, these cells are characterised by their low proliferative rate and their capacity for giving rise to several different cell types including epidermal kerati – nocytes, sebaceous gland cells, and the various different types of epithelial cells of the lower follicle [35]. This area also contains melanocyte stem cells [36]. Moreover, recently nestin, the neural stem cell marker protein, was also shown to be expressed in the bulge area of the hair follicle. Nestin-positive stem cells isolated from this area could differentiate into neurons, glia, smooth muscle cells, and melanocytes in vitro. Experiments in mice confirmed that nestin-expressing hair follicle stem cells can differentiate into blood vessels and neural tissue after transplantation to the subcutis of nude mice [37]. These experiments suggest that hair-follicle bulge-area stem cells may provide an accessible source of undifferentiated multipotent stem cells for therapeutic applications [37].