Various stages of evolution of surface instability leading to dewetting are investigated for thin (<100 nm) fluid films subjected to the long range van der Waals interactions on a nonwettable solid. The problems of pattern selection and complete three-dimensional morphology are resolved based on numerical solutions of the nonlinear two-dimensional thin film equation. The initial small scale random nonhomogeneities are quickly reorganized into a large scale coherent bicontinuous structure consisting of "hills" and "valleys," which is reminiscent of the classical picture of the spinodal decomposition in the linear approximation. On the level of a "unit-cell," the bicontinuous structure slowly evolves into an increasingly axisymmetric circular pattern, and eventually a growing circular hole (dry spot) is formed. Scaling arguments, as well as the simulations give the characteristic mean area of a unit-cell containing a single hole to be proportional to (h04gamma/|S|), where h0 is mean thickness, gamma is surface tension, and S is the spreading coefficient. Copyright 1997 Academic Press. Copyright 1997Academic Press