In the past, intercellular penetration was assumed to be the most important penetration pathway of topically applied substances. First hints that follicular penetration needs to be taken into consideration were confirmed by recent investigations, presented during the workshop "Follicular Penetration and Targeting" at the 4th Intercontinental Meeting of Hair Research Societies", in Berlin 2004. Hair follicles represent an efficient reservoir for the penetration of topically applied substances with subsequent targeting of distinct cell populations, e.g., nestin-expressing follicular bulge cells. The volume of this reservoir can be determined by differential stripping technology. The follicular penetration processes are significantly influenced by the state of the follicular infundibulum; recent experimental investigations could demonstrate that it is essential to distinguish between open and closed hair follicles. Topically applied substances can only penetrate into open hair follicle. Knowledge of follicular penetration is of high clinical relevance for functional targeting of distinct follicular regions. Human hair follicles show a hair-cycle-dependent variation of the dense neuronal and vascular network. Moreover, during hair follicle cycling with initiation of anagen, newly formed vessels occur. Thus, the potential of nestin-expressing hair follicle stem cells to form neurons and blood vessels was investigated.