No. He means, I think, that it would help us a great deal if you show us
the exact results (only relevant bits please) that you get from applying
the template that David suggested. You should get something like:

   old[with spaces]
   new[with&spaces]

if you view it in the browser (like Mark suggests), it likely looks more
like this, but is actually the rendered result of your output:

   old[with spaces]
   new[with&spaces]

After removing old/new, you should, of course, get "with&spaces". If
this latter is not correct, then we'd like to see a full stylesheet
(small example please) plus a small input XML that reproduces this
behavior with the processor you use.

Cheers,
-- Abel Braaksma

I see what you mean. I'm opening the output in a plain text editor
(Notepad). The template does seem to be replacing the indexterm
character spaces with ampersands.

Sorry about that!  I mistakenly thought that the template wasn't
working, because many of my intexterm elements are nested (which I
didn't think was important to mention :-(). The template removes the
nesting and displays all of the indexterms in a single indexterm
element.

<indexterm>
   old[domainsand components]
   new[domainsand&amp;components]
 </indexterm>

Thanks,
Mark