In the former type the mesoblast and hypoblast are formed either from cells budded off from the outer cells of the blastosphere or from the solid inner mass of cells; while the outer ciliated cells become the epiblast. This type of larva, which is found in the majority of sponges, is very similar in its general characters and development to many Coelenterate planulæ. The second type of larva is very peculiar, and though in its fully developed form it is confined to the Calcispongiæ, where it is the usual form, a larval type with the same characters is perhaps to be found in other sponges, _e.g._ amongst the Gumminæ, and amongst the Silicispongiæ where one-half of the embryo is without cilia, though in the case of the Silicispongiæ the cells of the ciliated part of the embryo correspond to the granular cells of the larva of Sycandra. The later stages in the development of the larvæ of the Porifera are not similar to anything we know of in other groups. It might perhaps be possible to regard sponges as degraded descendants of some Actinozoon type such as Alcyonium, with branched prolongations of the gastric cavity, but there does not appear to me to be sufficient evidence for doing so at present. I should rather prefer to regard them as an independent stock of the Metazoa. In this connection the amphiblastula larva presents some points of interest. Does this larva retain the characters of an ancestral type of the Spongida, and if so, what does its form mean? It is, of course, possible that it has no ancestral meaning but has been secondarily acquired; but, assuming that this is not the case, it appears to me that the characters of the larva may be plausibly explained by regarding it as a transitional form between the Protozoa and Metazoa. According to this view the larva is to be considered as a colony of Protozoa, one-half of the individuals of which have become differentiated into nutritive forms, and the other half into locomotor and respiratory forms. The granular amoeboid cells represent the nutritive forms, and the ciliated cells represent the locomotor and respiratory forms. That the passage from the Protozoa to the Metazoa may have been effected by such a differentiation is not improbable on _a priori_ grounds. While the above view seems fairly satisfactory for the free-swimming stage of the larval sponge, there arises in the subsequent development a difficulty which appears at first sight fatal to it. This difficulty is the invagination of the ciliated cells instead of the granular ones. If the granular cells represent the nutritive individuals of the colony, they, and not the ciliated cells, ought most certainly to give rise to the lining of the gastrula cavity, according to the generally accepted views of the morphology of the Spongida. The suggestion which I would venture to put forward in explanation of this paradox involves a completely new view of the nature and functions of the germinal layers of adult Spongida.