Both interactions between like cells, as between chondrogenic cells in a developing cartilaginous rudiment, and between unlike cells, as in epithelial-mesenchymal interactions, are dealt with in this review. Such interactions may involve direct apposition of cell membranes or may be mediated via interaction with peri- or extracellular matrices. An ontogenetic approach is taken in which cellular interactions involved in five processes of the development of cartilage and bone are discussed, the five being (1) origin of the cells, (2) migration of the cells within the embryo, (3) localization of the cells at their final embryonic site, (4) differentiation, and (5) morphogenesis. Some emphasis is placed on interactions affecting neural crest-derived cells both before and during their migration and on interactions, especially epithelial-mesenchymal interactions, that precede cytodifferentiation of chondroblasts or osteoblasts. Whether epithelial or mesenchymal specificity is required for such interactions to occur is discussed with reference to the otic vesicle-otic mesenchyme interaction that leads to differentiation and morphogenesis of the cartilaginous otic capsule.