Molecular beam epitaxy of PbTe on BaF2(111) is studied using reflection high‐energy electron diffraction (RHEED). The influence of growth parameters (substrate temperature and growth rate) on surface kinetics and the steady‐state growth surface morphology is investigated employing dynamical RHEED measurements (RHEED oscillations). For a well adjusted stoichiometric PbTe beam flux composition, two‐dimensional layer‐by‐layer growth can be achieved from substrate temperatures as high as 410 °C down to temperatures below 95 °C, with a maximum number of 230 RHEED oscillations observed at substrate temperatures in the 160 °C range. At temperatures above 400 °C, the growth kinetics start to be modified by PbTe reevaporation from the layer surface. The dependence of the RHEED oscillations on substrate temperature and growth rate indicates the importance of adatom surface diffusion for the surface morphology developed under steady‐state growth conditions, and for all growth conditions, a close correlation between steady‐state growth surface step density and damping of RHEED oscillations is observed. Furthermore, it is shown that even very small changes in the beam flux composition have a dramatic influence on the RHEED intensity oscillations as well as the surface processes involved in the growth. With only a small additional Te2flux used for the growth, an abrupt growth mode transition from layer‐by‐layer to step flow growth is induced. This is the first evidence that PbTe molecules impinging on the layer surface do not dissociate upon adsorption, but remain in a molecular state until incorporated in the crystal lattice. ©1995 American Institute of Physics.