The fertilized egg (or cyst) of branchiopods is a highly resistant stage in the life cycle of these aquatic crustaceans. Previous examinations of these cysts have determined that early embryonic development arrests at a late blastula stage, resulting in a small, crescent-shaped body within the egg shell of these shrimp. Herein, we examine the early development of these embryos by sectioning eggs in the ovotestis, brood chamber, and several time periods after exit from the brood chamber in the clam shrimp Eulimnadia texana Packard. The early sections find no evidence of internal fertilization in the ovotestis. Eggs in the ovotestis showed no signs of cell division, whereas eggs sectioned from the brood chamber were found to be undergoing early embryonic development. A number of empty egg shells and the lack of unfertilized eggs in the brood chamber suggested that egg yolks quickly degrade after egg extrusion from the ovotestis. Cysts that were allowed to develop for 24, 48, 72, and 96 h, 1 week and 1.5 years were sectioned, and embryonic development did not change after the 48 h time period. Thus, embryos appear to arrest development somewhere between 24 and 48 h after exiting the brood chamber.