The synaptic neuropil of the olfactory (antennal) lobe of the moth Manduca sexta is subdivided into histologically conspicuous structures called glomeruli that are typical of olfactory systems in vertebrates and invertebrates. Each glomerulus consists of the highly branched neuritic arbors of both primary olfactory axons and antennal-lobe neurons, bounded by a nearly complete envelope of glial cells. We have studied events occurring during the first half of metamorphic adult development. The first signs of organization of the neuropil into glomeruli are changes in glial cells. Prior to the ingrowth of olfactory axons from the antenna, glial cells form a continuous border around the neuropil. When olfactory axons begin to reach the lobe, glial cells embark on a stereotyped series of changes: the border becomes disrupted, glial cells begin to proliferate and extend processes into the outer regions of the neuropil, and some glial cells migrate toward the center of the neuropil. Shortly thereafter, glomeruli emerge from the neuropil, delineated by glial cells. If, however, afferent axons are prevented from ever reaching the antennal lobe, glomeruli never develop and the glial cells remain almost entirely restricted to a thick layer bordering the neuropil. Thus sensory axons have a direct influence not only on neuronal but also on glial differentiation. Our results lead us to suggest that the glial cells may be in a position to act as intermediaries in developmental interactions between sensory axons and antennal-lobe neurons.