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Budding in colorectal cancer (CRC) is an importantpredictive factor for nodal and distant metastasis. On the other hand, the submucosallayer is composed ofloose connective tissue, suggesting that cancer in this area may represent malignant behaviour. The aim of this study was to investigate budding in different specific areas of CRC, and to clarify an optimal area forprediction of cancer behaviour.Budding in the submucosa and muscularispropria from a cohort of 251 pT2 CRCs operated upon with curative intent between 1990 and 2003 were analyzed and thepredictive significance for lymph node metastasis and clinical outcome were evaluated. High-grade budding was defined as five or more foci in a × 200 microscopic field.Among the factors analyzed, both budding in the submucosa and muscularispropria, and lymphatic invasion were significantly associated with lymph node metastasis (P < 0.05). Multivariate analysis showed that budding in the submucosa was an independentpredictive factor for lymph node metastasis together with lymphatic invasion. Patients with low grade budding in the submucosa had a better disease-free survival and overall survival rate than those with high grade budding.Budding in the submucosa was an optimalpredictive factor for lymph node metastasis and clinical outcome in patients with pT2 CRC.