The apparently primitive features of hagfishes are recognized as a crucial problem in the study of vertebrate evolution, although the monophyletic relationship between these animals and lampreys has been confirmed by large amounts of molecular data, including genome and EST sequences. To solve this problem requires knowledge of the developmental biology of hagfishes. We attempted to obtain embryos from the Japanese inshore hagfish (Eptatretus burgeri) and succeeded in preparing several nicely fixed embryos. Based on detailed histological observations and comparison of gene expression patterns with those of conventional vertebrates, we examined the developmental processes involved in some important morphological traits, including the neural crest, placode, pharyngeal arches, and others. Our data revealed that some apparently primitive morphological traits can be regarded as artifacts deriving mainly from fixation conditions. In addition, our long-term observations of live embryos revealed a slow developmental rate in this animal. In this review, we summarize recent developmental data from these hagfish embryos and discuss a plausible evolutionary scenario for vertebrate development, making comparisons with some old descriptions.