Exencephaly was induced in Wistar rat fetuses by the administration of a single dose of cyclophosphamide (15 mg/kg) in saline after neural tube closure. The neuroepithelium (NE) and the choroid plexus were studied electron-microscopically in sections taken from a few hours after treatment to day 19 of gestation. The reduction in polyribosomes and condensation of the nucleus and cytoplasm were followed by cell death and fragmentation in the NE. Such cellular debris were phagocytosed and digested by the apparently normal neuroblasts. Cell proliferation was inhibited. The progressive loss of cells and lack of neuropil arborisation resulted in the expansion of the extracellular space and reduced intercellular contacts. The internal and external limiting membranes became weak. The vascular endothelium was attenuated. There were no obvious discontinuities of endothelium, but clusters of extravascular red blood cells particularly in the vicinity of capillaries in the cavitations in the NE and in the ventricular lumen were prominent by day 15. Subsequently, the cavities in the NE frankly communicated with the ventricle internally and subcutaneous blebs externally . The choroid plexus of exencephalic embryos was more extensive than that of the age-matched controls. Hydropic vacuoles, dense bodies, distended mitochondria, clusters of vesicles in basal cytoplasm and lakes of monoparticulate glycogen progressively increased in the plexus cells. Pericapillary oedema was obvious in the core of the plexus. These observations suggest that, in addition to cell death and reduced cell proliferation, haemorrhage, oedema and enhanced cerebrospinal fluid production contribute to reopening of the closed neural tube in this model.