In smaller Teleostean eggs there is formed, before the blastoderm becomes differentiated into epiblast and lower layer cells, a complete stratum of cells around the nuclei in the granular layer underneath the blastoderm. This layer is the hypoblast; and in these forms the lower layer cells of the blastoderm are stated to become converted into mesoblast only. In the larger Teleostean eggs, such as those of the Salmonidæ, the hypoblast, as in Elasmobranchs, appears to be only partially formed from the nuclei of the granular layer. In these forms however, as in the smaller Teleostean ova and in Elasmobranchii, the cells derived from the granular stratum give rise to a more or less complete cellular floor for the segmentation cavity. The segmentation cavity thus becomes enclosed between an hypoblastic floor and an epiblastic roof several cells deep. It becomes obliterated shortly after the appearance of the medullary plate. At about the time when the three layers become established the embryonic swelling takes a somewhat shield-like form (fig. 33 A). Posteriorly it terminates in a caudal prominence (_ts_) homologous with the pair of caudal swellings in Elasmobranchs. The homologue of the medullary groove very soon appears as a shallow groove along the axial line of the shield. After these changes there takes place in the embryonic layers a series of differentiations leading to the establishment of the definite organs. These changes are much more difficult to follow in the Teleostei than in the Elasmobranchii, owing partly to the similarity of the cells of the various layers, and partly to the primitive solidity of all the organs.