Nitrogenase activity was measured in leaves along the main stem axes of Azolla pinnata R. Br. The activity was negligible in leaves of the apical region, rapidly increased to a maximum as leaves matured, and declined in aging leaves. In situ absorption and fluorescence emission spectra were obtained for individual vegetative cells and heterocysts in filaments of the A. pinnata and Azolla caroliniana endophytes removed from the cavities of progressively older leaves. These spectra unequivocally demonstrate the occurrence of phycobiliproteins in the two cell types of both endophytes at the onset of heterocyst differentiation in filaments from young leaves, during the period of maximal nitrogenase activity in filaments from mature leaves, and in filaments from leaves entering senescence. Phycobiliproteins of the A. caroliniana endophyte were purified and extinction coefficients determined for the phycoerythrocyanin, phycocyanin, and allophycocyanin. The phycobiliprotein content and complement of sequential leaf segments from main stem axes and of vegetative cell and heterocyst preparations were measured in crude extracts. There was no obvious alteration of the phycobiliprotein complement associated with increasing heterocyst frequency of the endophyte in sequential leaf segments and the phycobiliprotein complement of heterocysts was not appreciably different from that of vegetative cells. These findings indicate that the phycobiliprotein complement of the vegetative cell precursor is retained in the heterocysts of the endophyte.