Peripheral sensory axons innervate the epidermis early in embryogenesis to detect touch stimuli. To characterize the time course of cutaneous innervation and the nature of interactions between sensory axons and skin cells at early developmental stages, we conducted a detailed analysis of cutaneous innervation in the head, trunk, and tail of zebrafish embryos and larvae from 18 to 78 hours postfertilization. This analysis combined live imaging of fish expressing transgenes that highlight sensory neurons and skin cells, transmission electron microscopy (TEM), and serial scanning electron microscopy (sSEM). In zebrafish, the skin initially consists of two epithelial layers, and all of the axons in the first wave of innervation are free endings. Maturation of the epithelium coincides with, but does not depend on, its innervation by peripheral sensory axons. We found that peripheral axons initially arborize between the two epithelial skin layers, but not within the basal lamina, as occurs in other organisms. Strikingly, as development proceeds, axons become tightly enveloped within basal keratinocytes, an arrangement suggesting that keratinocytes may serve structural or functional roles, akin to Schwann cells, in somatosensation mediated by these sensory neurons. J. Comp. Neurol., 2012. © 2011 Wiley Periodicals, Inc.