Skin pieces from 14-day fetal mice were cultivated for 1-10 days prior to fixation and sectioning. Subsequently, sections were studied by light and transmission electron microscopy. In a standard medium the lateral hair follicle walls showed progressive maturation of the basal lamina, while the hair matrix, at the time of a known tissue interaction, showed the formation of gaps in the basal lamina, with heterotypic cell contacts through the gaps. In a vitamin-A enriched medium similar changes occurred, not only at the hair matrix, but also at lateral follicle walls, at the sites of, and prior to, budding and glandular morphogenesis. This study shows that the induction of hair matrix by dermal papilla may perhaps be added to the list of normal tissue interactions in which heterotypic cell contacts occur. It also suggests that vitamin-A induced glandular morphogenesis might come about through a mechanism resembling a normal tissue interaction.