Proliferative enteropathy, caused by Lawsonia intracellularis, offers the opportunity to examine bacterial mechanisms that influence epithelial cell proliferation. Ultrastructural features of developed and resolving lesions included the presence of enlarged intestinal crypts containing undifferentiated immature epithelial cells and an absence of goblet cells. Numerous intracytoplasmic bacteria, identified as L. intracellularis, were consistently present within affected cells. In recovering intestinal tissue, additional features were (1) the common presence of pale, swollen, protruding epithelial cells, (2) shrunken, degenerate epithelial cells, (3) apoptotic bodies in both epithelial cells and macrophages, (4) the reappearance of normal goblet cells, and (5) reduced numbers of L. intracellularis within lesions. Bacteria were released from cells via cytoplasmic and cellular protrusions into the intestinal lumen. It is speculated that the presence of the intracytoplasmic bacterium, L. intracellularis, may disrupt normal processes of cell growth, differentiation or apoptosis in the intestinal epithelium.