Transmission and scanning electron microscopy were used to study the epithelio-mesenchymal interface between the interacting mouse ureter-bud and the metanephric mesenchyme. The gap between the epithelial and mesenchymal cells varied in width. At the stalk of the ureter-bud the interspace was often about 1 mum, but in the inductively active areas at the tips of the branching ureter-bud epithelio-mesenchymal contacts were seen through discontinuities in the basal lamina. At these points the gap between the interacting cells was often less than 20 nm, in places less than 10 nm. The amount of electron-dense, ruthenium-red-positive material was greatest at the stalk of the ureter-bud, but only a small amount of extracellular material was found between the interacting cells at the tips. Whether epithelio-mesenchymal cell contacts play a role in kidney tubule induction is not yet known, but their existence in the inductively active areas and their absence in inactive zones suggests that they are morphogenetically significant. The finding also obviates the need to postulate long-range transmission of inductive signals to explain this example of embryonic induction.