Of 27 Asians with a megaloblastic bone marrow, 22 (81%) had nutritional deficiency of vitamin B12 (NMA), while five (19%) had true pernicious anaemia (PA). All the patients were Hindu vegetarians except for a single Muslim who had PA. Dietary intakes of calories, protein, iron, vitamin B12 and folate were below the recommended level in both groups. The PA group had lower levels of serum B12 and higher levels of serum folate than the NMA group. Despite low levels of red cell folate (RCF) in the NMA patients, the abnormality in deoxyuridine (dU) suppression was always corrected by vitamin B12. The dU suppressed value showed a significant inverse relationship to the RCF level. Nutritional deficiency of vitamin B12 is the most common cause of megaloblastic anaemia in Hindu vegetarians but the incidence of true PA is higher than previously thought and may approximate to that of the white population.