Chromosomal inversion polymorphism was characterized in Finnish Drosophila montana populations. A total of 14 polymorphic inversions were observed in Finnish D. montana of which nine had not been described before. The number of polymorphic inversions in each chromosome was not significantly different from that expected, assuming equal chance of occurrence in the euchromatic genome. There was, however, no correlation between the number of polymorphic inversions and that of fixed inversions in each chromosome. Therefore, a simple neutral model does not explain the evolutionary dynamics of inversions. Furthermore, in contrast to results obtained by others, no significant correlation was found between the two transposable elements (TEs) Penelope and Ulysses and inversion breakpoints in D. montana. This result suggests that these TEs were not involved in the creation of the polymorphic inversions seen in D. montana. A comparative analysis of D. montana and Drosophila virilis polytene chromosomes 4 and 5 was performed with D. virilis bacteriophage P1 clones, thus completing the comparative studies of the two species.