The relationships of capsulation, hyaluronic acid and hyaluronidase production in 3 group A strains, A118, Alll, and NCTC 8198, and 3 group C strains, LG(NCTC 6178, C7 (NCTC 4540), and LM(NCTC 6176) were examined. The group A strains and strain LM of group C produce capsules and hyaluronic acid during the period of active growth. The amount of hyaluronic acid found in cultures of strain LM is a balance of synthesis and destruction, and is influenced by aeration of the culture. Aeration has no effect on strains producing either the enzyme or its substrate exclusively. Strain LM was grown without serum, results in increased hyaluronidase activity and the absence of capsules or hyaluronic acid. Preparations from such a culture show spreading factor activity.