Brain lesions in 2 natural cases of canine encephalitozoonosis were studied by light and electron microscopy. Granulomatous reactions, associated with small vessels and capillaries, partly originated from extensive perithelial cell proliferation which ultimately produced the epithelioid cell component. Diffuse glial reactions apparently occurred in relation to the vasculitis. Lymphoid cells infiltrated the epithelioid and glial cell inflammation. Encephalitozoon in all its reproductive stages was identified as the aetiological agent, and ultrastructurally differentiated from Nosema on the basis that a single nucleus was observed. Viable organisms were present only within endothelial cells. Macrophages containing dead spores were usually seen around parasitized vessels and, less frequently, in the neuropil. Organisms, whether viable or non-viable, were never seen extracellularly at the ultrastructural level. Selected histochemical stains and electron microscopy were used to differentiate between viable and non-viable spores. Vasculitis is demonstrated as the underlying lesion of canine encephalitozoonosis affecting the brain and is suggested to be the basic factor in the pathogenesis of this disease.