A detailed study of so-called communicating cartilage canals, which penetrate deeply up into the lower hypertrophic zone of the epiphyseal growth plate in the embryonic chicken femur (E20), was carried out with the aim to clarify whether or not these canals are involved in the bone-forming process. In addition, we examined the manner in which cartilage canals are formed and compare the present data with our previous data. The canals were investigated by means of light microscopy, electron microscopy, immunohistochemistry (VEGF, VEGFR2/Flk1, type I collagen), and 3D reconstruction. Some communicating canals deeply penetrate into the upper hypertrophic zone where they terminate, showing electron-dense cells at their end. Subcellular characteristics of these cells are hardly detectable and we suppose that they undergo cell death. Other canals pass down deeper into the lower hypertrophic zone. The upper segment of these canals is composed of capillaries, mesenchymal cells, and macrophage-like cells. Precursors of osteoblasts are adjacent to the canals. The lower segment of communicating canals is composed of bone matrix or osteoid, which contains type I collagen fibrils and cells having the typical subcellular features of osteoblasts. No vessels are found in these segments. Immunohistochemistry shows that the matrix of the canals labels positively for type I collagen. In addition, staining with sirius red demonstrates that bone matrix is formed in these parts. We assume that the osteoblast-like cells of the lower segments of communicating canals originate either from mesenchymal cells or even from hypertrophic chondrocytes. Our immunohistochemical data also reveal that vascular endothelial growth factor (VEGF) and the corresponding receptor VEGFR2/Flk1 (VEGF receptor 2/Flk1) are localized in cartilage canals of the reserve zone, the proliferative zone, and the hypertrophic zone. The receptor is found in the endothelial cells of the vessels. Furthermore, VEGF is present in hypertrophic chondrocytes. The results of our study suggest that cartilage canals penetrate actively into the cartilage anlage and that bone is formed in the lower segments of the communicating canals where no vessels are detectable.