Fourteen steps of spermatid development in the tammar wallaby (Macropus eugenii), from the newly formed spermatid to the release of the spermatozoon into the lumen of the seminiferous tubules, were recognised at the ultrastructural level using transmission and scanning electron microscopy. This study confirmed that although the main events are generally similar, the process of the differentiation of the spermatid in marsupials is notably different and relatively more complex than that in most studied eutherian mammals and birds. For example, the sperm head rotated twice in the late stage of spermiogenesis: the shape of the spermatid changed from a T-shape at step 10 into a streamlined shape in step 14, and then back to T-shape in the testicular spermatozoa. Some unique figures occurring during the spermiogenesis in other marsupial species, such as the presence of Sertoli cell spurs, the nuclear ring and the subacrosomal space, were also found in the tammar wallaby. However, an important new finding of this study was the development of the postacrosome complex (PAC), a special structure that was first evident as a line of electron dense material on the nuclear membrane of the step 7 spermatid. Subsequently it became a discontinuous line of electron particles, and migrated from the ventral side of the nucleus to the area just behind the posterior end of the acrosome, which was closely located to the sperm–egg fusion site proposed for Monodelphis domestica (Taggart et al. 1993). The PAC and its possible role in both American and Australian marsupials requires detailed examination. Distinct immature features were discovered in the wallaby testicular spermatozoa. A scoop shape of the acrosome was found on the testicular spermatozoa of the tammar wallaby, which was completely different to the compact button shape of acrosome in ejaculated spermatozoa. The fibre network found beneath the cytoplasm membrane of the midpiece of the ejaculated sperm also did not occur in the testicular spermatozoa, although the structure of the principal piece was fully formed and had no obvious morphological difference from that of the epididymal and ejaculated spermatozoa. The time frame of the formation of morphologically mature spermatozoa in the epididymis of the tammar wallaby needs to be determined by further studies.