Two infants presented at three and five weeks of age with megaloblastic anemia and systemic manifestations of vitamin B12 deficiency in spite of normal levels of serum vitamin B12. A deficiency of vitamin B12 transport protein transcobalamin II (TC II) was demonstrated in both infants by DEAE-cellulose ion-exchange chromatography and polyacrylamide gel electrophoresis. Complete hematologic remission was achieved by parenteral administration of large amounts of vitamin B12 at a dose of 2000 μg per week. Withdrawal of therapy in one sibling led to relapse of megaloblastic anemia in six weeks. Absorption studies in the older sibling showed decreased absorption of vitamin B12, which was not corrected by intrinsic factor, suggesting that TC II has a role in absorption of the vitamin. Hematologically normal parents and several other members of the family had low levels of vitamin B12 binding capacity of TC II, suggesting an autosomal recessive mode of inheritance for TC II deficiency.