Large doses of cortisone were given to growing and adult rabbits over a five-month period to produce avascular necrosis of the femoral head. The cortisone caused an increase in the serum cholesterol, fatty metamorphosis of the liver, and fat emboli visible in sections of the femur and humerus. These emboli partially obliterated the microcirculation of the subchondral vessels of both femoral and humeral heads. The average diameter of the marrow fat cells also increased more than ten micrometers. This increase in cell volume might be significant because in the closed chamber of the femoral head it could increase tissue pressure, diminish perfusion, and be the mechanism for avascular necrosis induced by cortisone.