Spontaneous teratocarcinogenesis in the mouse testis begins during the early stages of gonad differentiation. Using inbred strain 129/Sv-ter mice which are highly susceptible to these tumors, the authors have examined the morphologic features of the testis during the gestational period defined from Day 13 through birth. Normal inbred mice (129/J) and random bred mice (Swiss Webster, SW) were used as control groups. Serially sectioned gonads were evaluated at the light- and electron-microscopic levels for histologic changes. In agreement with studies by other workers, embryonal carcinoma cells (ECCs) were observed in tumor-susceptible mice. Cellular arrangements varied from vesicular to nodular. Cell death within advanced tumors was labeled "apoptosis" (shrinkage necrosis). Also encountered were syncytial arrangements of gonocytes (atypical gonocytes), which were present in all animal groups. The significance of atypical gonocytes in relation to degeneration and preneoplasia is addressed.