The clinical, histopathological, and ultrastructural features of a case of parafoveal telangiectasis are reported. No telangiectasis of retinal vessels was found. Instead, there was thickening of the wall of the retinal capillaries and narrowing of the calibre of the lumen. Thickening was due to marked proliferation of basement membrane in a multilayered configuration, Cellular debris from degenerated endothelial cells and pericytes, and multimembranous lamellar lipid material were entrapped between layers of basement membrane. Extensive degeneration of pericytes was observed, and occasional areas showed degenerated endothelial cells. These changes were not restricted to the clinical-affected parafoveal area but were also seen to a lesser degree throughout the retina. The changes are interpreted as being due to primary endothelial cell degeneration and regeneration, with successive waves of basement membrane production and secondary degeneration of pericytes.