Villi lining the avian intestine originate from longitudinal folds (previllous ridges) running the length of the embryonic intestine. The morphogenetic events that occur in the epithelium during initial ridge formation in the chick embryo duodenum were examined by light and electron microscopy. The epithelium, in cross-section, undergoes three stages prior to the formation of ridges; termed the circle (4 1/2-6 days), the ellipse (6-8 1/2 days), and the triangle (5 1/2-9 days). At about 9 days of development three ridges form with three more forming one day later. The mechanisms responsible for folding of the epithelium were examined. Microdissection followed by organ culture demonstrated that constriction by the surrounding circular smooth muscle cannot account for folding of the epithelium. Mitotic pressure within the epithelium also cannot account for folding since there is no difference in the number of epithelial cells per cross-section between the ellipse and the triangle stages and the epithelial tube is not restricted from expanding. Active constrictions in groups of epithelial cells, mediated by bands of microfilaments, are thought to cause folding. Bundles of microfilaments are localized in the apical region of all epithelial cells at all stages studied and are localized in the basal region of those cells occupying the crests of the forming ridges. Cytochalasin B-treatment prevented ridge formation and disrupted the bundles of microfilaments.