The parthenogenetic metacercarial stages of the gymnophallid trematode Cercaria margaritensis are found in the extrapallial cavity of the subtidal prosobranch mollusc Margarites helicinus. The primary metacercariae (M1) produce second-generation metacercariae (M2) which become independent and give rise to M3 metacercariae which are infective to the definitive host, the common eider (Somateria mollissima). This study used transmission electron microscopy to follow the development of M2 inside M1 organisms and M3 inside M2 organisms. The process is similar in both cases with embryos developing from individual cells from the parent body walls. In each case the brood sac was divided into brood chambers by multilaminated cells and both M2 and M3 embryos developed inside embryonic membranes that originated from specialized blastomeres. The tegument of M2 and M3 embryos developed in a similar manner underneath the embryonic membrane. Both the multilaminated cells and the embryonic membranes possessed features that indicated that they are involved in transport of nutrients. It is suggested that the continuous nature of M2 and M3 embryo development may well be similar to that postulated for ancestral digeneans.