The free spindled cells of the lamina propria of the gut have been reported as showing fibroblastic, smooth-muscle and myofibroblastic differentiation. A precise understanding of the differentiation of these cells is essential for appreciating their functions, and this paper addresses this question using ultrastructural analysis. Histologically normal samples from different areas of the gastrointestinal tract were studied. Both subepithelial stromal cells, lying immediately beneath the basal lamina, and the deeper interstitial stromal cells, were studied. Subepithelial and interstitial cells had comparable features, reinforcing the idea that these formed a single reticulum of cells. Two major cell types were identified. Some were smooth-muscle cells, on the basis of abundant myofilaments with focal densities, glycogen, an irregular cell surface, focal lamina and multiple attachment plaques alternating with plasmalemmal caveolae. Some cells had a lesser expression of these markers, especially of myofilaments, and were regarded as poorly differentiated smooth-muscle cells and descriptively referred to as ‘myoid’. Other cells were fibroblastic to judge by prominent rough endoplasmic reticulum, an absence of myofilaments and lamina, but presence of focal adhesions. The fibronexus junctions of true myofibroblasts were not seen. The study emphasises that the smooth-muscle actin immunoreactivity in this anatomical site resides in smooth-muscle cells and not in myofibroblasts, a view consistent with earlier ultrastructural and immunostaining results. The recognition that these cells are showing smooth-muscle or fibroblastic but not true myofibroblastic differentiation should inform our understanding of the function of these cells.