Notch pathway genes have been implicated in the commitment of mesenchymal cells to a wool follicle cell fate. Notch1 and Delta1 transcripts were quantified in fetal skin of fine-woolled (Merino) and strong-woolled (Tukidale) sheep at two time points: either preceding (d56) or during (d70) the first wave of follicle initiation. DIG-labelled probes for both transcripts were localised in the epithelium, some mesenchymal cells, and in the dermal condensates of primordia. The possibility that condensates selectively incorporated Delta1-labelled mesenchymal cells is considered. The involvement of Notch1 in condensate formation was also explored in cultured fetal skin explants and whisker papilla cells using DAPT to block Notch signalling. In its presence, follicle initiation in skin explants was reduced, and the propensity for cultured papilla cells to aggregate was abolished. Results suggest that Notch1 activation is a prerequisite for mesenchymal aggregation. It is speculated that Delta interactions contribute to condensate formation, in vivo.