The mutualistic association between the squid Euprymna scolopes and the bacterium Vibrio fischeri is an emerging experimental system for the study of the influence of bacteria on animal development. Taking advantage of the ability to raise both this host and its microbial partner independently under laboratory conditions, we describe the effects of bacterial interactions on morphogenesis of the juvenile host symbiotic organ. Our results show that bacteria are essential for normal postembryonic development of the symbiotic organ, which involves changes in both the surface epithelium and the epithelial tissue within the organ where the bacterial culture will take up residence. Cell death induced by exposure to symbiotic V. fischeri results in the regression of a complex ciliated surface epithelium, a tissue that apparently functions to facilitate inoculation of the juvenile organ with the appropriate specific bacterial species. Regression of this tissue begins within hours of exposure to symbiosis-competent bacteria and progresses over the next 5 days, at which time full regression is complete, resulting in a symbiotic organ whose epithelial surface resembles that of the fully mature organ. Moreover, symbiosis-competent bacteria induce modification of the epithelial cells of the crypts that will house these symbionts; these cells undergo significant changes in shape and size in response to interactions with symbiotic V. fischeri. In contrast, we find that when these tissues are not exposed to the proper bacterial symbionts they remain in a state of arrested morphogenesis, a condition that can be rescued by interactions with symbionts. The results of these studies are the first experimental data demonstrating that a specific bacterial symbiont can play an inductive role in animal development.