The process by which cells gradually specialize and undergo change in shape and function is called cell differentiation. Differentiation of cells begins during gastrulation and continues through tissue formation.
All the genes of a cell do not function at the same time. There is differential gene action. Some genes are 'switched on' and function for a time producing a particular protein. They are then 'switched off' and then become dormant. Cell differentiation thus results from the fact that different genes are activated at different times. Many genes in a particular cell may not function at all. Cells are influenced not only by their genes, but also by the by products of their own metabolism. Also differentiation of cells may depend upon substances received from neighbouring cells.