This chapter describes plasticity and differentiation of retinal precursor cells. Retinal photoreceptors are unique cells, whose high degree of specialization and differentiation can be recognized in their shape and organization, in the presence of many unique proteins, and in their physiological activities. Visual perception is based on the cortical processing of neurochemical signals generated within the retina in response to the light entering the eye from the external world. The photoreceptors are the retinal cells that set this visual process in motion by transducing light into neurochemical signals. Most vertebrate retinas have two major photoreceptor subtypes, the rods and the cones, which share many features but also have distinctive structural, chemical, and functional differences. One of the most remarkable aspects of the differentiation of isolated photoreceptor precursor cells in culture is their capacity to develop and maintain, even when grown in the absence of intercellular contacts, a highly elongated, compartmentalized, and polarized pattern of organization. © 1993, Academic Press Inc. All rights reserved.