Phloem exudation from Ricinus has been examined in plants subjected to changes in water balance induced by a number of means. The results have provided a clear demonstration that the phloem system can operate osmotically. When the availability of water in the xylem is reduced by withholding water, the rate of exudation decreases sharply and this is accompanied by a rise in the sap concentration. On removing the water stress, the rate increases rapidly with a corresponding fall in sap concentration.Small variations in water availability do not give significant results and may be buffered by responses from the plant itself. This could also explain the insignificant changes in sap composition during exudation previously reported, where exudation rate, which should bear some relation to sieve tube turgor pressure, seems independent of sap concentration. Fluctuations in exudation rate are large in comparison with the changes in sap concentration when severe water stresses are applied. This result, coupled with the observation that exudation will occur from plants under considerable water stress suggests the operation of a "sugar pump" capable of maintaining a high turgor pressure at the source against a considerable water potential gradient. The main "pump" is probably located in the leaves.Thus interpreted, the results seem to accord with the Münch pressure flow hypothesis in all significant aspects.