Kinetics of the hillock and island formation during annealing of thin gold film has been studied. The reorganisation of gold film has been distinguished ir~ five stages in progression from the original film to the final island structure. The area occupied by the holes remained virtually constant until the removal of the metal from the substrate started. No increase in the number of holes was detected in the induction period. Hole densities decrease with increasing film thickness. Agglomerates were frequently found at the side of an enlarging hole. The hole growth rate increased steadily with temperature. The growth rate of holes eventually leads to _~. network structure. The catchment area increased with increasing initial film thickness.