The interstitial cells which give rise to the ovary, after increasing in volume become differentiated into two distinct regions : a central region which contributes directly to the formation and growth of the ovum, and a peripheral region whose nuclei later enter the egg and become changed into yolk. Occasionally two nuclei persist in the central region and give rise to two distinct ova. Each ovum has its individual membrane and is entirely independent of the other. The ova are forced through the small opening of the ectoderm to the exterior by the contraction or pulling back of the ectoderm. The polar bodies remain attached to the egg until after the third cleavage by means of a connecting thread of cytoplasm. When the eggs are not fertilized they disintegrate and finally fall to pieces. The cleavage is total, unequal and regular. The cleavage cells communicate with each other by means of protoplasmic bridges or connections. There is a passage of substance from one cleavage cell to the other. The cleavage cavity begins with the third cleavage. The blastula when completely formed is a hollow sphere of primitive ectodermal cells. The origin of the endoderm is multipolar. The outer and inner egg membranes are formed from the ectoderm ; the first is formed by an outgrowth of the ectodermal cells, the second by means of a secretion from the same cells. The inner ends of the ectodermal cells persist and become the definitive ectoderm. The gastrula consists of a solid spherical mass of cells surrounded by the egg membranes. The eggs are either glued to the object on which the parent rests or remain attached to the parent until the embryo hatches. The eggs of Hydra sp.? will not continue to develop when removed from the parent after fertilization occurs, or even after cleavage has begun. Hydras seldom continue to reproduce by budding after the sexual generation is completed. Exhaustion due to vigorous budding precedes the appearance of the sexual organs, more especially the ovaries. Hydra sp.? reproduces by budding during the entire year. No sexual organs were found on the hydras when collected, but after the animals had been kept in aquaria with abundance of food, sexual organs appeared on those hydras that had been budding vigorously for several weeks. Spermaries or ovaries never appeared on buds. It gives me pleasure to express my gratitude to Dr. George Lefevre for reading this manuscript.