We have employed the fluorescent dye nile red to distinguish between normal cells and cells containing lysosomal accumulations of phospholipids. When fibroblasts from an individual with a genetic deficiency in lysosomal sphingomyelinase activity (Niemann-Pick disease) were stained with nile red and visualized by fluorescence microscopy, orange-colored inclusions were observed throughout the cytoplasm. The orange fluorescent bodies could be distinguished from the neutral lipid droplets that fluoresce a brilliant yellow-gold in the presence of nile red. These inclusions were also observed in alveolar macrophages obtained from rats treated with amiodarone, an antiarrhythmic agent known to produce lysosomal phospholipidosis. Flow cytofluorometric analysis revealed that staining of these phospholipid-rich macrophages with nile red can distinguish them from control alveolar macrophages. These results demonstrate that nile red can be employed for the rapid staining of cellular phospholipid inclusions.