In avian embryos the formation of ventrolateral abdominal muscles was studied by (1) heterospecific grafting experiments between chick and quail embryos and (2) ultrastructural examinations of cells having part in this process. The results demonstrate that the muscle cells are of somitic origin while the connective tissue derives from the somatopleure. Somatopleural cells do not differentiate into myocytes, and somite cells which have entered the ventrolateral abdominal wall, do not contribute to the connective tissue. It is concluded that both dermatome and myotome cells undergo muscular differentiation. The formation of muscles is found to take place in four characteristic steps. During the 4th day of development, epithelially structured ventral somite buds enter the somatopleure. The light cells of the inner myotome layer are elongated in a cranio-caudal direction and contain randomly distributed microfilaments. On the 5th day, the buds lose their epithelial arrangement and change into compact processes in which cells intermingle. The myotome cells show short bundles of thin and thick microfilaments. The third step can be characterized by the appearance of intercellular spaces and the disaggregation of processes becoming invaded by somatopleural cells. Thus, subdivision in single muscle blastemata begins to occur. In 7-day embryos, the muscle anlagen are distinctly separated and the first myotubes containing regularly arranged myofibrils are found. Coincidentally, signs of cell death are observed. Up to the 10th day, the tendons being of somatopleural origin become plainly outlined and the muscle anlagen move to their definitive positions. It is assumed that the formation of muscle pattern is controlled by the somatopleure.