The extensor digitorum longus muscle of the rat was denervated and transplanted onto the vastus lateralis muscle of the same limb 1 or 2 weeks after denervation. The morphological changes appearing after transplantation were examined by light and electron microscopy. Only three to four superficial layers of muscle fibres remained unchanged after transplantation. The other parts of the transplanted muscle degenerated nearly entirely during the first 10 days. The myofibrils were removed by macrophages, thus within the tubes of basal lamina no contractile material could be observed. In a second period, regeneration of myofilaments took place. 6 weeks after transplantation, newly formed muscle could be observed, capable of normal function. The diameter of the fibres, however, was smaller and the connective tissue between the fibres markedly increased as compared to the normal muscle of the other side. The importance of the findings for muscle transplantation, especially the relationship between satellite cells and myoblasts, is discussed.