Condensation formation. (A) Mesenchymal cells are first induced by epithelial signaling molecules through diffusion, close interaction with the basement membrane or direct cell–cell interaction. (B) Condensation is then initiated by a signaling pathway involving neural cell adhesion molecules (NCAM) and N-cadherin. (C) A boundary surrounding the condensed cells is then established which permits (D) growth of the condensation from incoming cells that adhere to the condensation and cells undergoing proliferation within the condensation. Signaling molecules involved in each step are color-coded for the location in which they appear. Grey, dark blue, green, and light blue correspond to epithelial cells, condensed cells, the condensation boundary, and mesenchymal cells, respectively.