Abstract: During the regeneration of the tail in the arboreal New Zealand gecko (Hoplodactylus maculatus) a new set of tail scales, modified into pads bearing setae 5-20 μm long, is also regenerated. Stages of the formation of these specialized scales from epidermal pegs that invaginate the dermis of the regenerating tail are described on the basis of light and electron microscopic images. Within the pegs a differentiating clear layer interfaces with the spinulae and setae of the Oberhäutchen according to a process similar to that described for the digital pads. A layer of clear cytoplasm surrounds the growing tiny setae and eventually cornifies around them and their spatular ends, later leaving the new setae freestanding on the epidermal surface. The fresh adhesive pads help the gecko to maintain the prehensile function of its regenerated tail as together with the axial skeleton (made of a cylinder of elastic cartilage) the pads allow the regenerated tail to curl around twigs and small branches just like the original tail. The regeneration of caudal adhesive pads represents an ideal system to study the cellular processes that determine setal formation under normal or experimental manipulation as the progressive phases of the formation of the setae can be sequentially analyzed.