Eight dermatofibromas were studied by electron microscopy. The essential cell was the fibroblast, characterized by a well developed rough endoplasmic reticulum (RER), a distinct Golgi zone and large numbers of cytofilaments. The fibroblast of the dermatofibroma was engaged in collagen production and fat storage. The ability of fibroblasts to phagocytize was clearly demonstrated by phagocytosis of white blood cells after the intralesional injection of blood. Since fat storage and phagocytosis of cell fragments, generally regarded as characteristic of histiocytes in light microscopy, were found to occur in fibroblasts in our ultrastructural investigation it is concluded that all dermatofibromas, even those showing phagocytosis and formerly referred to as histiocytomas, are composed of fibroblasts.