An electron microscopical (EM) analysis was performed on regions of polytene chromosomes which contained DNA segments of different genetic composition, inserted by P element-mediated transformation into the Drosophila melanogaster genome. In seven of ten regions examined, containing insertions of the hsp28-ry, hsp70-Adh, ryhsp 70-β-gal genes and of the ry gene tetramer, new bands appeared. Lack of new bands in three other strains is apparently connected with the fusion of the inserted material to preexisting bands. The new bands do not differ morphologically from the usual bands of polytene chromosomes, and their formation is likely due to predominant insertion of DNA segments into interbands. Among the constructs examined, the minimal length of a DNA segment which appears as a new band is about 5 kb; the DNA packing ratio in the new bands varies from 30 to 50. Activation of the inserted genes by heat shock has enabled us to observe the puffing characteristics of new bands. A sequence of some one kb forms a large interband, or micropuff; the puff size is correlated with the length of the genes being activated. If a DNA segment contains a single gene, then its activation causes the decompaction of the whole band; however, when a DNA segment consists of two genes and the promoter element of the activated gene is positioned in the middle of the sequence, the band splits and only part is decompacted and puffed. The DNA packing ratio in the puffs is 1.4–3.5. The subsequent deletion of the hsp70 promoter but retention of 23, 59, and 73 bp from the transcription start points leads to failure of puff formation. In all the transformed sites an increase in the total length of the interbands adjacent to the insert as compared with the initial interband was observed. This increase appears to be due to decompaction of the P element DNA flanking the inserted segments. It is shown that a DNA segment, consisting of four tandemly repeated ry gene copies and interspersed by material which includes P DNA, forms a complex of loose chromatin in which, however, four bands can be resolved. We also observed a lengthening of interband regions containing only the P element sequence itself. Insertion of the complete 2.9 kb P element into the large single 10A1-2 band of the X chromosome (an insertion in the region approximately 10 kb to the right of the v gene) causes splitting of the band into two parts and formation of a new interband. However, insertion of the 412 mobile genetic element from the copia family into the same region results in no such effect. These facts together with data on puffing initiation in the centre of the band, when the hsp70 promoter is inside the insert, necessitate a reappraisal of the putative unit character of polytene chromosome bands as regards decompaction.