The purpose of this study was to evaluate corneal reepithelialization and wound healing following annular excimer keratectomy. Two sets of experiments were performed on 35 rabbit eyes. In the first set of experiments, experiment I, deep Fresnel excimer keratectomy was performed, with a 6-mm outer and 3-mm inner diameter. Animals were sacrificed at 1, 5, 12, and 16 weeks, and corneas were examined by light and electron microscopy. In experiment II, the central epithelium was left intact, and superficial and deep mid-peripheral excimer annular keratectomies were performed measuring 6 mm in outer and 3 mm in inner diameter. Animals were sacrificed at 1 week, and corneas were examined by light microscopy. Following deep Fresnel excimer keratectomy (experiment I), corneas showed stromal edema in the central 3-mm zone. Intrastromal islands of epithelial cells with PAS positive basement membrane-like structures were seen histologically at 1 week. Electron microscopy showed loss of stromal collagen in areas adjacent to epithelial islands; in areas distant from the epithelial islands, the stromal collagen appeared normal. The overlying central stroma sloughed after 5 weeks. Anterior stromal scarring was observed. In experiment II (mid-peripheral annular keratectomy), intrastromal epithelial accretion was present in corneas with deep annular keratectomy but not in superficial annular keratectomy. Intrastromal epithelial accretion follows deep excimer annular keratectomy and is associated with adjacent stromal degradation.