The infection of nematodes by the endoparasitic fungus Verticillium balanoides was studied by means of optical and electron microscopical techniques. Conidia of this fungus adhere randomly in high numbers to the entire cuticle surface of the nematode Panagrellus redivivus. Adhesion is accomplished by means of a tri-layered adhesive pad located at the apical end of the conidium, the outermost layer of which shows a radiated substructure. After attachment an appressorium which grows through the adhesive pad and establishes a firm contact between the fungal cell wall and the nematode cuticle is formed. Penetration of the cuticle by means of a hyphal outgrowth on the appressorium is followed by the formation of an infection bulb from which trophic hyphae develop that invade the nematode. Approximately 60 h after infection conidiophores develop outside the nematode, producing numerous conidia. © 1993, British Mycological Society. All rights reserved.