The cellular distribution of a vertically transmitted, feminizing microsporidian was followed in its host Gammarus duebeni. In adult females the parasite was restricted to gonadal tissue, in particular primary and secondary follicle cells. Spores were diplokaryotic with a thin spore wall and a short polar filament, characteristics typical of ‘early’ spores involved in autoinfection. The diplokaryotic life-cycle, absence of spore groupings and of a pansporoblast membrane typify the genus Nosema. However, the unusual globular polaroplast of the spore and restriction of this stage to host ovarian tissue have not previously been described in Nosema. Sporogony occurred only in follicle cells adjacent to developing oocytes and was in synchrony with the process of vitellogenesis. Oocytes were infected after formation of intracellular connections with follicle cells but harboured only vegetative stages of the parasite. Parasites were associated with the perinuclear cytoplasm and, in developing embryos, segregated to daughter cells along the axis of the spindle. In juvenile animals there was no evidence of pathology linked with feminization and the parasite was found at low density in cells under the cuticle. The parasite is highly adapted to transovarial transmission with an efficient mechanism of oocyte infection and no evidence of pathology.