AbstractIsolated epithelioid cells from disaggregated rat BCG granulomas show a morphological spectrum from “plasmacytoid” to “vesicular” forms on electron microscopy. Functional studies on these isolated cells showed that all epithelioid cells exhibited poor trypsin‐resistant glass adherence and poor phagocytosis of latex, zymosan, antibody coated and complement coated erythrocytes when compared with macrophages, especially at the vesicular end of the spectrum. A high proportion of all epithelioid cell types was found to have Fc surface receptors but C3 receptors were reduced on vesicular cells compared with the plasmacytoid variety. The findings indicate that the progressive transformation of mononuclear phagocyles into vesicular epithelioid cells through plasmacytoid intermediates is accompanied by a concomitant modification of cell function. The significance of these changes is