Intercellular interactions are critical in the development of the nervous system. In the olfactory system of a moth, sensory axons induce the formation of large synaptic glomeruli, each surrounded by a glial envelope, in the antennal lobe of the brain. During development, the sensory axons cause changes in glial shape and disposition one day before glomeruli are recognized. Early removal of glial cells prevents the development of glomeruli despite the presence of afferent axons. Thus, the glial cells appear to play a role as intermediaries in the induction of glomeruli by afferent axons. Recent findings in the mammalian somatosensory cortex suggest a similar role for glia there.