The morphologic changes occurring in Ehrlich ascites tumor cells infected with chick embryo-adapted Newcastle disease virus were studied with phase microscope, conventional light microscope, and electron microscope. Intracytoplasmic inclusions appeared 2 to 4 hours following infection and progressively increased in size and numbers until cytolysis occurred. No significant alterations in mitochondria or other cell organelles were detected during the initial period of inclusion development. The inclusions were composed of a multilaminated shell, probably derived from the agranular reticulum of the EAT cell, surrounding an inner core packed with dense particles, measuring 3 to 14 mµ in diameter. These particles were tentatively identified as the newly synthesized "incomplete virus" which had been previously demonstrated by fluorescent antibody techniques. The possible role of the inclusions is discussed.

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