Scrapie is a transmissible spongiform encephalopathy (TSE) and its spread across the intestine of sheep is linked to the biology of intestinal Peyer's patches (PPs). Specialized epithelial cells, M cells, would appear to be the portal of entry for the scrapie agent, PrP Sc, while lymphoid nodules of PPs become major sites of accumulation of PrP Sc as the infection becomes established. Furthermore, evidence suggests that the enteric nervous system supplying the PPs is important for neuroinvasion. The gut-associated lymphoid tissue (GALT) of ruminants shows morphological and functional differences to the GALT of mice and humans. Recent investigations of aging scrapie-affected sheep revealed a substantial network of nerve fibres in the lymphoid nodules of PPs, contradicting the widely held notion that lymphoid nodules are poorly innervated. Advances in the understanding of the pathogenesis of scrapie may be achieved by a deeper appreciation of the development, morphology and function of GALT in small ruminants.