1. Changes which occur at frog neuromuscular junctions following denervation have been studied by combining intracellular recording and freeze-fracture electron microscopy. 2. Shortly after nerve section, both neuromuscular transmission and intramembrane structures of neuromuscular junctions remain normal. 3. Later, neuromuscular transmission fails, beginning with the disappearance of end-plate potentials (e.p.p.s) and followed by the disappearance of miniature end-plate potentials (m.e.p.p.s). The frequency of m.e.p.p.s which persist after cessation of e.p.p.s is not increased dramatically in K+-rich or hypertonic solutions. 4. Concomitant with the changes of transmission are changes in intramembrane structures. The first sign of these changes in disruption of active zones, which become disorganized, fragmented or vanish. Nerve terminals then disintegrate and eventually are engulfed by Schwann cells. 5. When neuromuscular transmission has failed completely, former sites of the neuromuscular junction are occupied by Schwann cells. These cells develop transverse ridges which lie opposed to junctional folds, just like active zones of nerve terminals. However, the ridges on Schwann cells do not contain organized rows of particles or clusters of any synaptic organelles, even at later stages when Schwann cell m.e.p.p.s commence. 6. It is suggested that the failure of e.p.p.s involves at least an impairment of the transmitter release mechanism at the nerve terminal, which is probably associated with the disruption of active zones. The cessation of m.e.p.p.s is thought to be caused by the engulfment of terminals by Schwann cells.