Treatment of chick embryos early in development with the teratogen, trypan blue, results in a high incidence of rumplessness at later developmental stages. Experiments were conducted to discover the causative events between dye administration and rumplessness. Initially, 167 two-day embryos were treated by injection of 0.02 ml 0.1% trypan blue (in saline) into the yolk sac. Controls (42) were injected with 0.02 ml of 0.85% NaCI. Dye-treated embryos examined at three days exhibited a high incidence of hematomas caudal to the leg buds. All embryos examined on or after five days were rumpless. Many embryos examined at four days exhibited an apparently intermediate condition in the development of this defecta caudal hematoma coupled with beginning degeneration of tail tissues, Histological analysis of these embryos and additional 60 examined and preserved at several intervals (12, 16, 20 and 24 hours) after dye administration suggested the following sequence of events: (1) swelling of the dorsal aortae, ( 2 ) bursting of these vessels in the rump, (3) hematoma formation by extravasation from the burst vessels, (4) destruction, by the hematoma, of surrounding rump tissues, (5) resorption of dead or dying tissues, (6) rumplessness. Studies of another series of embryos, each of which was studied in ovo for several days during development, confirmed the destructive effect of a hematoma on morphogenesis of the rump. Dye treated embryos which did not form a caudal hematoma went on to develop a normal rump. Conversely, each embryo which exhibited a caudal hematoma early in development eventually became rumpless.