Evidence is presented for the coexistence of smooth muscle and decidual cells in nodules on and within the ovarian tunica albuginea at term. Routine histologic techniques and electron microscopy have been employed in characterizing the morphology of the nodules. Recent literature concerning the frequency of ovarian decidualization during pregnancy is discussed with respect to the possible relationship of such decidualization to the histogenesis of leiomyomatosis peritonealis disseminala (LPD). The hypothesis that LPD may represent “disseminated fibrosing decidua” is discussed in light of finding collagen fibrils, secretory decidual cells, and smooth muscle cells in these nodules. It is concluded that the present case does not represent “fibrosing decidua.” The authors agree with others who have proposed that the smooth muscle in ovarian decidua and LPD result from proliferation of stem cells which may reside in the subperitoneal stroma in association with ectopic endometrial stroma and which may respond to the hormones of pregnancy.