Transfer cells (TCs) trans-differentiate from differentiated cells by developing extensive wall ingrowths that enhance plasma membrane transport of nutrients. Here, we investigated transcriptional changes accompanying induction of TC development in adaxial epidermal cells of cultured Vicia faba cotyledons. Global changes in gene expression revealed by cDNA-AFLP were compared between adaxial epidermal cells during induction (3 h) and subsequent building (24 h) of wall ingrowths, and in cells of adjoining storage parenchyma tissue, which do not form wall ingrowths. A total of 5795 transcript-derived fragments (TDFs) were detected; of these, 264 TDFs showed epidermal-specific changes in gene expression and a further 207 TDFs were differentially expressed in both epidermal and storage parenchyma cells. Genes involved in signalling (auxin/ethylene), metabolism (mitochondrial; storage product hydrolysis), cell division, vesicle trafficking and cell wall biosynthesis were specifically induced in epidermal TCs. Blockers of auxin action and vesicle trafficking inhibited ingrowth formation and marked increases in cell division accompanied TC development. Auxin and possibly ethylene signalling cascades induce epidermal cells of V. faba cotyledons to trans-differentiate into TCs. Trans-differentiation is initiated by rapid de-differentiation to a mitotic state accompanied by mitochondrial biogenesis driving storage product hydrolysis to fuel wall ingrowth formation orchestrated by a modified vesicle trafficking mechanism.