There occurs in the small intestines of a large percentage of calves up to and including the 3rd day a hydropic condition of the epithelium. This manifests itself in the form of a large vacuole or vesicle usually under the top plate of the epithelial cell. More rarely a number of smaller vesicles or vacuoles replace it. These may break away from the cell and float free when bits of the fresh mucosa are gently compressed under a cover-glass. The vesicles probably contain coagulable protein. This condition has its origin in late intrauterine life. It involves the lowest third of the small intestine and extends upwards as far as the duodenum in some cases. It is not a necessary forerunner of the early diarrhea or scours. Its relation to this disease is not defined. It may or may not be accompanied by a fat stasis of the upper third of the small intestine. Frequently associated with it is coagulable protein in the contents of the ileum.