It is shown that a new segregation-based mechanism underpins the Stranski-Krastanow (S-K) epitaxial islanding transition in both the InxGa1-xAs/GaAs and Si1-xGex/Si systems over wide ranges of growth conditions. Quantitative segregation calculations allow critical 'wetting' layer thicknesses to be derived and, for the InxGa1-xAs/GaAs system (x = 0.25-1), such calculations show good agreement with experimental measurements. The segregation-mediated driving force is considered to be important, also, for all other epitaxial systems which comprise chemically similar but substantially misfitting materials and which exhibit the S-K transition. (c) 2004 Elsevier B.V. All rights reserved.