The events involved in vasculogenesis still remain obscure. One difficulty has been the techniques employed to visualize angioblasts, i.e., vascular precursors, during the genesis of blood vessels. The retina provides a unique model for studying these events since it is not completely vascularized in some mammals at birth. Using a previously published magnesium-dependent ATPase technique to visualize the developing retinal vasculature and its precursors, and embedding this tissue in JB-4 methacrylate for serial sectioning, has permitted examination of the retinal vasculogenic processes in dual perspective. The technique has permitted observation of the stages in angioblast differentiation and the apparent importance of glycosaminoglycan-rich cell-free spaces in this process. Perhaps the most important observation is that initial vessel formation occurs by coalescence of angioblasts after differentiation in situ.