Embryonic development in Drosophila melanogaster begins with a rapid series of mitotic nuclear divisions, unaccompanied by cytokinesis, to produce a multi-nucleated single cell embryo, the syncytial blastoderm. The syncytium then undergoes a process of cell formation, in which the individual nuclei become enclosed in individual cells. This process of cellularization involves integrating mechanisms of cell polarity, cell-cell adhesion and a specialized form of cytokinesis. The detailed molecular mechanism, however, is highly complex and, despite extensive analysis, remains poorly understood. Nevertheless, new insights are emerging from recent studies on aspects of membrane polarization and insertion, which show that membrane components from intracellular organelles are involved. In addition, actin and actin-associated proteins have been heavily implicated while new evidence shows that microtubule cytoskeletal elements are mechanistically involved in all aspects of cellularization. This review will draw on both the traditional models and the new data to provide a current perspective on the nature of cellular blastoderm formation in Drosophila melanogaster.