Large-scale movements of epithelial sheets are necessary for most embryonic and regenerative morphogenetic events. We have characterized the cellular processes associated with germ band retraction (GBR) in the Drosophila embryo. During GBR, the caudal end of the embryo retracts to its final posterior position. We show using time-lapse recordings that, in contrast to germ band extension, cells within the lateral germ band do not intercalate. In addition, the germ band and amnioserosa move as one coherent sheet, and the amnioserosa strongly shortens along its dorsal-ventral axis. Furthermore, during GBR, the amnioserosa adheres to and migrates over the caudal end of the germ band via lamellipodia. Expression of both dominant-negative and constitutively active RhoA in the amnioserosa disrupts GBR. As RhoA acts on both actomyosin contractility and cell-matrix adhesion, it suggests a role for such processes in the amnioserosa during GBR. The results establish the cellular movements and shape changes occurring during GBR and provide the basis for an analysis of the forces acting during GBR.