The macadamia tree, an Australian native, is highly valued for its nuts. Macadamia improvement programs so far have relied on conventional breeding and selection. The production of improved cultivars required to meet future demands could be accelerated by the application of modern biotechnological techniques, but this requires an efficient and reproducible regeneration system that has not yet been established for macadamia. We report here shoot regeneration from immature cotyledon explants of macadamia. Adventitious buds were induced on the cotyledon explants from fruits collected at 140 and 190 days after full bloom (DAFB) on MS medium supplemented with either 10 or 15 microM TDZ. The addition of 2% coconut milk (CM) to 10 microM TDZ containing media resulted in enhanced adventitious bud induction from 190 DAFB explants. Further shoot development from the induced buds was depressed in media containing TDZ + CM; the addition of 0.001 microM IAA to this combination doubled shoot development, from 1.9-3.9 shoots per explant. The transfer of bud clumps to media supplemented with 8.8 microM BA alone or in combination with either 0.14 microM GA(3) or 0.001 microM IAA significantly increased shoot production from the previously induced explants by 1.5-2 times of that observed in TDZ + CM medium. Histological examinations revealed that shoot regeneration was primarily by organogenesis originating from cells on or just below the cut surfaces of explants.