A description is given of both naturally occurring and experimentaly produced brown-tail moth caterpillar dermatitis. Epicutaneous test reactions were studied in a group of 45 persons, utilizing different setae preparations obtained from Euproctis chrysorrhoea L. About 70% of the individuals developed marked reactions upon contact with untreated nettling hairs. The early skin lesions were as a rule erythematous and wheal-like in character (urticarial), gradually becoming more infiltrated and developing into erythematous papules or vesicles. Treatment of the nettling hairs either by heating or saline extraction resulted in a partial loss only of their skin irritating properties; heat treatment being slightly more effective in this respect. Intracutaneous tests with a sline extract of nettling hairs elicited positive skin reactions in all individuals tested. Biochemical analysis of the crude extract revealed the presence of a potent esterolytic enzyme. Apart from their skin irritating action, the nettling hairs were found capable to induce the formation of spherocytes when mixed in vitro with human erythrocytes. The relevance of this phenomenon is discussed. On the basis of our findings and those of other it is suggested that the action of the nettling hairs upon the human skin is dependent both on a toxic and mechanical traumatic principle.