1. The administration of 10 mg. of cortisone per day to rabbits caused a depression in the proliferation of all the cells in nerves undergoing Wallerian degeneration.

  2. The increase in numbers of cells within Schwann tubes was most affected, that of the endoneurial connective tissue cells and of the cells of the blood-vessel wall less.

  3. A greater depression of population occurred at the 10th day of degeneration than at the 20th or 25th.

  4. In vitro fewer cells migrated from expiants of degenerating peripheral nerves from animals receiving cortisone than from degenerating nerves from control animals, but the difference is accounted for by different numbers of cells in the expiants.

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