Marek's disease virus (MDV) is an oncogenic cell-associated herpesvirus that causes T-cell lymphoma in chickens. Lymphoproliferative neoplasms in Marek's disease (MD) occur in various organs and tissues, including the viscera, peripheral nerves, skin, gonads, and musculatures. MDV is restrictively produced in the feather follicle epithelial (FFE) cells, and it gains access to the external environment via infected cells or as infectious enveloped cell-free virus particles. The goals of the present study were to 1) determine whether the MDV-induced skin lesions are neoplastic in nature or inflammatory reactions to viral infection, 2) determine whether physical presence of feather follicles (FF) is necessary for skin tumor development, and 3) study the role of skin epithelial cells not associated with feathers or FF in the replication and dissemination of infectious virus particles. Scaleless chickens that produce only a few scattered feathers and no sculate scales along the anterior metatarsi were used as a unique model to study the pathogenesis of dermal lesions. Histologic and immunohistochemical analysis revealed that the cutaneous lesions were tumorous as was manifested by massive accumulation of lymphoblasts and extensive activation of meq oncoprotein, the hallmark of MDV oncogenesis, within the skin lesions. Neoplastic cutaneous lesions in the scaleless chickens indicate that feather follicles are not necessary for skin tumor development. Finally, our preliminary data indicate that inoculation with supernatant fluid from homogenized and sonicated skin samples of MDV-infected scaleless chickens induces MD in susceptible birds, suggesting that skin epithelial cells not associated with FF also harbor infectious viral particles.