The neostriatum and spinal cord of embryonic and fetal mice were examined to determine the identity of prenatal phagocytes and the differentiation of microglia. In the neostriatum amoeboid microglia were present from E13 and were phagocytosing cellular debris. A wide variety of forms was present, from microglia with extremely vacuolated cytoplasm to some with virtually no vacuoles. Both types were observed in the process of mitotic division. In the spinal cord microglia could be identified in both white and grey matter from E 12 onwards. Between E12 and E15 large phagocytic cells were present, especially in the ventral horns. These appear to be macrophages, probably derived from blood monocytes. It was possible to construct a structural sequence of differentiation of these large macrophages into microglia. Amoeboid microglia with large vacuoles were not present in the prenatal spinal cord. Both actively phagocytic macrophages and microglia were found undergoing mitosis.