The establishment of normal iron levels in the neonatal brain is critical for normal neurological development. Studies have shown that both iron uptake and iron concentration in the brain are relatively high during neonatal development. This histochemical study was undertaken to determine the pattern of iron development at the cellular level in the rat forebrain. Iron-stained cells were observed as early as postnatal day (PND) 3, which was the earliest time point examined. At PND 3, there were four major foci of iron-containing cells: the subventricular zone and three areas within the subcortical white matter. These latter foci are associated with myelinogenic regions. The blood vessels were prominently stained for iron throughout the brain. At PND 7, as in PND 3, the majority of the iron-containing cells were in white matter. However, there were also patches of iron staining located specifically in the layer IV of the somatosensory cortex. These cortical patches were no longer visible by PND 14. At PND 14, numerous iron-stained cells were dispersed throughout white matter regions and the tanycytes aligning the third ventricle were prominently stained. The blood vessel staining was less prominent than at earlier time periods. By PND 28, the adult pattern of iron staining was emerging. Iron-stained cells were aligned in rows in white matter and had an apparent preference for a location near blood vessels. This clustering of iron-positive cells around blood vessels gave the white matter a "patchy" appearance. The pattern of development, cell distribution, and morphological appearance of the iron-stained cells are consistent with that reported for oligodendrocytes. That iron-positive cells in the neonate may be oligodendrocytes is consistent with the reports for iron staining in adult brains. The recent reports that oligodendrocytes are highly susceptible to oxidative damage would be consistent with the high iron levels found in these cells. These results indicate that oligodendrocytes play a major role in the development of iron homeostasis in the brain. The role of iron in oligodendrocytes may be associated with metabolic demands of myelinogenesis, including cholesterol and fatty acid synthesis. However, these cells may be a morphologically similar but functionally distinct subset of oligodendrocytes whose function is to regulate the availability of iron in the brain.