The gastrodermal secretory cells inHydra viridis are limited to specific regions in the body column. There are two types of mucous cells present, and they are limited to the hypostome. The zymogen cells are absent from the hypostome, but they extend along the body column from the tentacles to the peduncle. Transection beneath the tentacles produces a proximal portion of the hydra devoid of mucous cells. This piece regenerates new tentacles and a normal hypostome, filled with mucous cells, within four days.The following events were observed during regeneration. The zymogen cells formed an aggregate within twenty-four hours in the region of the presumptive hypostome. These cells organized and formed lobes of zymogen cells that were positioned similarly to the arrangement of mucous cells in the normal animal. Sparsely distributed small basophilic cells were also present in the reforming hypostome. Using corresponding thick and thin sections we identified the cells incorporating radiosulfate: 1) The zymogen cells in the distal aggregate. 2) Small basophilic cells, some filled with free ribosomes, and others with a well-developed E. R. 3) Secretory cells containing both mucous and serous granules. 4) Secretory cells with granules similar to the granules in mouse Paneth cells.The fate of the secretory granules in the zymogen cells in the distal aggregate is unknown. Some are autolysed within the cell, and others are extruded. However, some observations suggest that there may be a direct transformation of some of the serous granules to mucous granules. The E. M. observations, the radiosulfate incorporation data, and the migrations of cells to the wound site, suggest that both the zymogen cells and basophilic cells transform to mucous cells. Identification of the early stages of mucous synthesis in these basophilic cells enabled us to study the sequence of mucous granule maturation of both the hypostomal mucous cells.The two most significant questions which we feel remain unaswered are: 1) What are the ultrastructural events during the zymogen cell transformation to a mucous cell ? 2) What is the origin of the small gastrodermal basophilic cells ?