The survival, revascularization, reinnervation, and recovery of function of transplanted rat pineal glands were studied following grafting into four different locations in pinealectomized rats. Pineal grafts were well vascularized by fenestrated capillaries. Pinealocytes in the grafts maintained high-metabolic activity. More nerve fibers and terminals were observed in the grafts within the anterior chamber of the eye than in the third cerebral ventricle and the pineal region (in situ transplantation). No fibers or terminals were found in grafts placed beneath the renal capsule. Nighttime serum melatonin levels increased significantly in pinealectomized rats with transplants into either the third cerebral ventricle or the anterior eye chamber. This increase might reflect graft reinnervation. Yet day-night differences in serum melatonin were observed only in host rats receiving transplants in the anterior eye chamber. In conclusion, pinealocytes survived transplantation into different locations and exhibited ultrastructural features indicative of active secretory processes; however, day-night differences in serum melatonin are only restored following transplants into the anterior eye chamber. Reinnervation of the grafts by the host superior cervical ganglion is necessary for this restoration.