“But when Von Dohlen and her student Shawn Kohler examined the mealybugs’ so-called “symbiotic spheres,” long assumed to be host structures that housed bacteria, they became stumped. Using a technique called fluorescent in situ hybridization, they found evidence of both beta-proteobacteria and gamma-proteobacteria inside the spheres. But even using electron microscopes, they couldn’t localize the beta-bacteria. Finally, microscope supervisor William McManus asked, “What if the symbiotic spheres ARE bacteria?” Von Dohlen and Kohler looked at each other. “When he said that, everything suddenly made sense,” von Dohlen says.”
Here’s the ScienceNOW report of the nested bacteria in the mealybug [I didn’t realize the site was publishing way back then. Alas, the links in the article are all dead.]