During macronuclear differentiation in ciliated protozoa, extensive DNA rearrangement and DNA excision processes occur, and these are most profound in stichotrichous ciliates, such as Stylonychia or Oxytricha. This review describes the morphological and molecular events taking place during macronuclear development in stichotrichous ciliates. Various models for the regulation of macronuclear differentiation have been proposed and will be discussed here. Finally, an attempt to speculate about the biological consequences of these rearrangement and excision processes will be made. Because specific elimination of DNA sequences not required in the differentiated nucleus can be regarded as the most extreme form of gene silencing, results obtained in these cells may also be relevant for our understanding of differentiation processes in higher eukaryotic organisms.