Aural cholesteatomas may arise in the middle ear by a variety of mechanisms; in some cases it appears that cholesteatomas arise within or behind an intact tympanic membrane. We have observed that microcholesteatomas arise within the tympanic membrane of mongolian gerbils which have keratin accumulations on the lateral surface of the tympanic membrane. An ultrastructural study of the keratinizing epithelium of these animals showed that breaks in the basal lamina allow pseudopods of epithelial cells to extend into the lamina propria and form epithelial cones. The basal lamina later reconstituted itself. Keratinization may occur within these ingrowing cones forming microcholesteatomas. This sequence of events may explain the occurrence of intratympanic cholesteatomas in humans in the absence of invagination or perforation.