The mechanosensory lateral-line system offers a unique opportunity to study a wide variety of developmental phenomena, including cell migration, the origin of polarity, and pattern formation. In this study, we use a series of transplantation experiments to examine some of the factors affecting the origin of the lateral-line placodes, the establishment of sensory organ polarity and placement, and the guidance of cell migration in the Mexican axolotl (Ambystoma mexicanum). We find that placode-forming ectoderm is at least partially specified as early as the beginning of neurulation, and we suggest that this may be a result of early processes involved in neural induction. Furthermore, we find that the migration of the primordia on the body depends on the presence of both the ectoderm and the subjacent mesoderm for guidance. Sensory organ polarity on the body appears to be the result of an interaction between the primordia, which deposit organs of set polarity relative to the direction of migration, and the substrate, which determines the direction of migration. Spacing of the organs is independent of the substrate, and may be due to an intrinsic property of either the primordia or the emerging organs themselves. Finally, we suggest that the lateral-line primordia are guided, as they migrate, by a contact guidance mechanism.