When their growth is arrested in culture, susceptible 3T3 fibroblasts differentiate into adipose cells. Different clones form adipose cells with different frequency, depending upon the proportion of susceptible cells they contain. In cultures grown from small inocula, the fat cells appear in clusters formed by colonies of susceptible cells. Study of these clusters indicates the infrequent occurrence of cellular transitions from insusceptible to susceptible state. Beginning with a clone converting to adipose cells with a vary low frequency, it has been possible, by serial selection, to generate subclones which convert with a high frequency. This evolution is due to spontaneous heritable changes affecting susceptibility to the adipose conversion. Presumably, they involve the control of triglyceride synthesis. Early stages of the adipose conversion may be recognized in stained cultures. When triglyceride first begins to accumulate, the highly extended and flattened processes of the cells are probably similar to those of nonfatty cells in the same cultures. As the adipose conversion proceeds, the processes thicken and retract; the cells eventually acquire the rounded shape of the more mature adipose cells.