The initial stages of epitaxial growth of Ag on InP(100) have been studied usinginsituandexsituelectron microscopy. Vicinal InP substrates were cleaned by heating to about 400 °C in ultrahigh vacuum. Silver was deposited at substrate temperatures between 350 and 500 °C. The microstructural evolution was monitored for coverage between 0.5 and 8 monolayers usinginsituhigh spatial resolution secondary electron microscopy andexsituplan‐view transmission electron microscopy (TEM). At sub‐monolayer coverage, uniform, faceted islands of Ag are formed with edges aligned along InP ⟨110⟩ directions. Continued deposition leads to growth of preexisting islands followed by coalescence. During coalescence, a reduction in the island height, an increase in island‐substrate interfacial area, and a disappearance of faceting are observed. At high coverage, during high temperature (450 °C) growth, the formation of faceted pits are observed. For higher temperatures (500 °C) and at low coverage, islands transform from square to rectangular shapes. Plan‐view TEM indicates that the smallest Ag islands (∼5 nm) are not coherent with the substrate and that there are two distinct epitaxial relationships between the Ag islands and the InP substrate. For high‐temperature growth, the (110)Ag plane is parallel to InP(100) substrate and there is evidence for chemical reaction and presence of In on the surface. For lower temperature depositions (350–400 °C), the (100)Ag is parallel to (100) InP. ©1996 American Institute of Physics.