Furosemide-induced (400mg/kg ip) hepatotoxicity progressing to centrilobular necrosis was studied by light and electron microscopy in Swiss white mice. Centrilobular glycogen depletion and cytoplasmic foaminess, usually accompanied by extensive vacuolation, were detectable by light microscopy 1 1/2 hr after furosemide. Centrilobular congestion and hydropic single cell necrosis developed after 3 hr. Electron microscopy revealed disaggregation of polyribosomes, vesiculation of endoplasmic reticulum, an endocytic origin for the vacuolation, and a definite sequence in the development of congestion. Vacuolation coincided with loss of microvilli and resulted in detachment of sinusoidal lining cells from hepatocytes. Small vacuoles apparently formed at the sinusoidal margin of hepatocytes by fusion of microvilli. Congestion and occlusion of sinusoidal lumens developed as a consequence of erythrocytes entering the enlarged Disse space, possibly through pores in the lining cells, and thence entering endocytic vacuoles. The vacuolation, loss of microvilli and terminal hydropic degeneration suggest an important role for the plasma membrane in the development of furosemide-induced hepatotoxicity. Comparisons with known membrane toxins support this concept.