Ultrastructural studies were made of the central nervous system of three goats during the early stages of viral leukoencephalomyelitis of goats and of one goat 3 years after onset of the disease. In both early and late lesions, the following features were recognized: loss of myelin from normal axons, separation of the myelin sheath from the axon by cell processes, pronounced astrocytosis with numerous cell processes packed with heavy fibrils, paucity of oligodendrocytes, normal capillaries, and normal cellular elements in the adjacent gray matter. Early lesions also had many cells of the lymphoid series infiltrating perivascular spaces, within lesions, and, particularly, along axons undergoing demyelination. Although viral particles were extensively sought, only one suspect structure, with a tubular nucleocapsid-like configuration, was seen. Individual tubules of this particle measured 22 nm. in diameter. The ultrastructural features of demyelination in viral leukoencephalomyelitis of goats were compared with those described for demyelination that occurs in multiple sclerosis, experimental allergic encephalomyelitis, canine distemper encephalomyelitis, and that produced by diphtheria toxin.