<p>I had data in XML  that had line feeds, spaces, and tabs that I wanted to preserve in the output HTML (so I couldn't  use &lt;p&gt;) but I also wanted the lines to wrap when the side of the screen  was reached (so I couldn't use &lt;pre&gt;).</p>

I and a co-worker (Patricia Eromosele) came up with the following solution:  (Is there a better solution?)
```
<p>
<xsl:call-template name="prewrap">
<xsl:with-param name="text" select="text"/>
</xsl:call-template>
</p>
<xsl:template name="prewrap">
<xsl:param name="text" select="."/>
<xsl:variable name="spaceIndex" select="string-length(substring-before($text, '  '))"/>
<xsl:variable name="tabIndex" select="string-length(substring-before($text, '&#x09;'))"/>
<xsl:variable name="lineFeedIndex" select="string-length(substring-before($text, '&#xA;'))"/>
<xsl:choose>
<xsl:when test="$spaceIndex = 0 and $tabIndex = 0 and $lineFeedIndex = 0"><!-- no special characters left -->
<xsl:value-of select="$text"/>
</xsl:when>
<xsl:when test="$spaceIndex > $tabIndex and $lineFeedIndex > $tabIndex"><!-- tab -->
<xsl:value-of select="substring-before($text, '&#x09;')"/>
<xsl:text disable-output-escaping="yes">&amp;nbsp;</xsl:text>
<xsl:text disable-output-escaping="yes">&amp;nbsp;</xsl:text>
<xsl:text disable-output-escaping="yes">&amp;nbsp;</xsl:text>
<xsl:text disable-output-escaping="yes">&amp;nbsp;</xsl:text>
<xsl:call-template name="prewrap">
<xsl:with-param name="text" select="substring-after($text,'&#x09;')"/>
</xsl:call-template>
</xsl:when>
<xsl:when test="$spaceIndex > $lineFeedIndex and $tabIndex > $lineFeedIndex"><!-- line feed -->
<xsl:value-of select="substring-before($text, '&#xA;')"/>
<br/>
<xsl:call-template name="prewrap">
<xsl:with-param name="text" select="substring-after($text,'&#xA;')"/>
</xsl:call-template>
</xsl:when>
<xsl:when test="$lineFeedIndex > $spaceIndex and $tabIndex > $spaceIndex"><!-- two spaces -->
<xsl:value-of select="substring-before($text, '  ')"/>
<xsl:text disable-output-escaping="yes">&amp;nbsp;</xsl:text>
<xsl:text disable-output-escaping="yes">&amp;nbsp;</xsl:text>
<xsl:call-template name="prewrap">
<xsl:with-param name="text" select="substring-after($text,'  ')"/>
</xsl:call-template>
</xsl:when>
<xsl:otherwise><!-- should never happen -->
<xsl:value-of select="$text"/>
</xsl:otherwise>
</xsl:choose>
</xsl:template>
```
Source:
http://jamesjava.blogspot.com/2008/06/xsl-preserving-line-feeds-tabs-and.html