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Heterosis achieved through continuous crossbreeding can be used to increase weight of calf weaned per cow exposed to breeding by 20%. Comprehensive programs of breed characterization have revealed large differences among breeds for most bioeconomic traits. About 55% of the U.S. beef breeding population involving 93% of the farmers and ranchers who produce beef cattle are in production units of 100 or fewer cows. Optimum crossbreeding systems are difficult to adapt in herds that use fewer than four bulls. Further, fluctuation in breed composition between generations in rotational crossbreeding systems can result in considerable variation among both cows and calves in level of performance for major bioeconomic traits unless breeds used in the rotation are similar in performance characteristics. Use of breeds with similar performance characteristics restricts the use that can be made of breed differences in average genetic merit to meet requirements for specific production - marketing situations. The potential of composite breeds as an alternative to continuous crossbreeding for using heterosis and for using genetic differences among breeds to achieve and maintain a more optimum additive genetic (breed) composition needed to be investigated in a comprehensive experiment. The primary objective of this experiment was to estimate the retention of combined individual and maternal heterosis in advanced generations of inter sè mated composite populations established with contributions from either four or five breeds. Retention of initial (F1) heterozygosity after crossing and subsequent random (inter sè) mating within crosses is proportional to (n-1)/n when n breeds contribute equally to the foundation. When breeds used in the foundation of a composite breed do not contribute equally, percentage of mean F1 heterozygosity retained is proportional to (Equation) where Pi is the fraction of each of n contributing breeds to the foundation of a composite breed. This loss of heterozygosity occurs between the F1 and F2 generations, and if inbreeding is avoided, further loss of heterozygosity in inter sè mated populations does not occur. A primary question in this experiment was the extent to which retention of heterosis in composite populations is proportional to retention of heterozygosity.