The radial solute exchange between xylem and phloem is an important determinant of the nutrient distnbution and C/N economy of seed plants. Nevertheless, our knowledge of the mechanism of xylem-phloem exchange is very limited. This paper aims to integrate anatomical and physiological data about xylem-phloem exchange and focuses on the mechanisms of radial transport. Electrophysiological mapping and intracellular injection of fluorescent dyes demonstrate that stem tissue is organized in symplastic subunits specialized in either longitudinal or lateral transport. Radial orientation, anatomical and physiological organization, strong metabolic activities, relatively negative membrane potentials, and high capacities of uptake make the rays the most likely routes for symplastic xylem-to-phloem transport. Parallel apoplastic transport may occur through radial canacules between the ray cells. The symplastic xylem-to-phloem transport includes a number of steps: (a) passage across the vessel/parenchyma interface, (b) transfer in the ray, and (c) delivery from the ray into the sieve tube/companion cell complex. Large contact pits in the vessel walls give access to the ray cells, by which the solutes are accumulated through substrate/proton co-transport. Dense pitting on the tangential walls and other ultrastructural features suggest preferential symplastic transport in the radial direction. Auxiliary endo/exocytosis is under dispute. The transport step from the ray to the sieve tube/companion cell complex remains to be elucidated. In phloem-to-xylem transport, the unloading from the phloem along the stem is essentially apoplastic, but under specific conditions it may be symplastic. Further transfer to the xylem probably occurs via the symplastic route through the ray. During radial transport, important metabolic interconversions take place into either transport or storage compounds. In many trees, the metabolism of the ray cells undergoes cyclic, annual fluctuations. Complex season-bound deposition/mobilization processes in the ray cells corresponding with seasonal changes in membrane permeability and cellular organization, reflect a master-system designed to coordinate the C/N economy throughout the year.