Initially unipolar, but subsequently bipolar, spore germination in Diphyscium foliosum produces two primary filaments tapering towards their tips. These narrow filaments, only 5-8 mu m in diameter, with non-pigmented walls, oblique septa and containing discoidal chloroplasts, trace at first an undulating and then a spiral course through agar media. Side branch initials are either cylindrical or swollen. The former produce identical or even narrower (3-5 mu m diameter) spirally-growing filaments: the latter develop, by tip growth, into massive upright branches. These are subsequently transformed, as a result of intercalary divisions, into solid, highly chlorophyllous, funnel-shaped appendages with a convex upper surface and undulate margins, recognised by previous authors as diagnostic of the genus. Filament tip cells may also produce massive branches and conversely secondary filaments grow out from the bases of the massive branches and from the columns of the funnels. Gametophores develop from both the tips of the massive branches and the bases of the columns. The rhizoids they produce in abundance are identical to the protonemal filaments. Unlike most other mosses protonemal development in Diphyscium appears to be unaffected by an absence of nutrients. Protonemata grown in culture are virtually identical to those found in nature. After prolonged culture the filaments of. Diphyscium become thick-walled and packed with lipid droplets. Their side branches and tips are transformed into clusters of long-lived, desiccation-resistant, caducous, spherical brood cells. At the same time the upright branches and funnel appendages are readily detached and may function as diaspores in nature. As in other mosses, activated charcoal inhibits brood cell formation whereas addition of abscisic acid hastens its onset. Neither napthalene acetic acid nor gibberellic acid have any noticeable effect on the protonemal system of Diphyscium, but kinetin stimulates bud formation at the tips of the upright branches and from the upper surfaces of the funnel appendages. The protonemal filaments of Diphyscium have a mixture of chloronemal and caulonemal attributes and are significantly narrower (5-8 mu m versus 18-24 mu m in diameter) than those of most mosses: Comparisons with the protonemal plates of Tetraphis and Sphagnum, and the responses to growth regulators, suggest that the upright branches and funnel appendages are best regarded as specialized caulonemal derivatives. Unlike the two former genera where plates are the dominant protonemal phase, filaments, upright branches and funnel appendages are of equal importance in Diphyscium.