How growth is distributed within the morphologically diverse thalli of lichens is still poorly known and the anatomical mechanisms involved are not well understood. This work applies electron microscopy (SEM and TEM) to examine cell- and tissue-level events in the umbilicate thallus of Lasallia pustulata, whose pattern of expansion was the subject of a previous field study. Stacks of epinecral tissue accumulating at the thallus surface showed broadening bases and recurring rupture attributable to diffuse expansion of the living tissue below. Cortical cells, dividing anticlinally, adjoined septa to previous septa, indicating parenchymatous divisions. These observations are all consistent with previous contentions that mature, organized tissues within the thallus are capable of continued diffuse growth. They provide a developmental explanation for the morphology of the epinecral layer and suggest that anatomical characteristics may be helpful in recognizing diffuse growth patterns. Parenchymatous cell divisions, believed until recently to never occur in lichen thallus tissues, are shown to play a developmental role in the diffuse growth of the umbilicate lichen thallus.