Twenty patients with chronic renal failure being treated with hemodialysis were investigated in an attempt to ascertain whether hyperparathyroidism is an important etiologic factor in these patients' anemia. The patients were divided into two groups, one with hemoglobin of greater than 8 g/dl and the other with hemoglobin of less than 8 g/dl. These groups differed in blood transfusion requirements and in serum iron saturation. There was no difference between their levels of serum calcium, serum phosphate, serum alkaline phosphatase or serum parathyroid hormone. On bone biopsy endosteal fibrosis with bone marrow involvement was found in 2 of the 11 patients with high hemoglobin and in 5 of the 9 patients with low hemoglobin. Endosteal fibrosis with bone marrow involvement may thus be an important factor in the pathogenesis of anemia, and its presence or absence in association with hyperparathyroidism may explain the controversial observations reported by other investigators.