The ductular complex of the Syrian hamster pancreas represents a system of conduit which encompasses intercalated (intralobular), periinsular, and intrainsular ductules. The intercalated (intralobular) ductules comprise centroacinar and intercalated cells. A meshwork of small ductules (invisible by usual histologic procedures) surrounds islets (periinsular ductules) and extends in the form of often ramified tiny channels within the islet (intrainsular ductules). Although the function of the latter ductules is obscure, their cells seem to make up one of the undifferentiated cellular units of the pancreas, and as such are also the progenitors of beta-cells of the islets (islet cell precursor= IP). Systematic histologic examination of the pancreas in this species treated with pancreatic carcinogen N-nitrosobis (2-oxopropyl) amine indicated that ductular cells, especially those of periinsular and intrainsular origin, are the most responsive to this carcinogen. The neoplastic process was initiated with hyperplasia of intercalated (intralobular) ductular and interlobular ductal cells associated with newly formed islets (nesidioblastosis). This process was followed by excess formation of mature but especially of immature islet cells and their precursors (IP) in the islet periphery, as well as with the appearance, distention, and multiplication of periinsular and particularly of intrainsular ductules. The hyperplasia, metaplasia, and malignant alteration of these periinsular and intrainsular ductules (including IP) and, to a lesser degree, of intercalated ductules indicated their histogenetic relationship and their potency for reproducing embryonic tissue on carcinogenic stimulus. The similarity of some induced lesions to diabetes has been emphasized.