Silver nitrate staining of blastoderms of Fundulus heteroclitus gastrulae shows that the number of marginal cells of the enveloping layer (EVL) is reduced from 160 to 25 during epiboly. To determine whether this decrease in the number of marginal cells was due to ingression, cell death, or rearrangement of cells, marginal and submarginal regions of the late gastrula were observed directly by time-lapse cinemicrography. Marginal cells rearrange to occupy submarginal positions by first narrowing their boundary with the external yolk syncytial layer (E-YSL), thus becoming tapered in shape. Then, the narrowed marginal boundary retracts from the E-YSL and moves submarginally in the plane of the epithelium. Concurrently, the marginal cells on both sides come into apposition; no gap or break appears in the circum-apical continuity of the epithelial sheet. Marginal cells leave the margin of the EVL during epiboly at a rate of about six per hour. The rate of movement of the EVL cells with respect to one another is about 0.5 to 1.0 micron/min at 21 degrees C. Submarginal cells rearrange in a similar fashion. Although no protrusive activity was seen at the lateral aspects of rearranging cells, the tapering or narrowing associated with rearrangement was accompanied by formation of microfolds on their apical surfaces, and separating or recently separated submarginal cells form "flowers" of microfolds on their apices adjacent to the site of separation. Morphometric analysis shows that about half the narrowing of the margin of the EVL during epiboly is accounted for by cell rearrangement and the other half by the associated tapering and narrowing. These results suggest that epiboly of the EVL may have an active component as well as a passive one.