Abstract. This paper proves the result of the title. It shows that there is a five-variable lattice identity which holds in all finite modular lattices but not in all modular lattices. It is also shown that every free distributive lattice can be embedded into a free modular lattice. An example showing that modular lattice epimorphisms need not be onto is given.We prove the result of the title by constructing a simple modular lattice of length six not in the variety generated by all finite modular lattices. This lattice can be generated by five elements and thus the free modular lattice on five generators, FM (5), is not residually finite.Our lattice is constructed using the technique of Hall and Dilworth [9] and is closely related to their third example. Let F and K be countably infinite fields of characteristics p and q, where p and q are distinct primes. Let Lp be the lattice of subspaces of a four-dimensional vector space over F, Lq the lattice of subspaces of a four-dimensional vector space over K. Two-dimensional quotients (i.e. intervals) in both lattices are always isomorphic to Mu (the two-dimensional lattice with « atoms). Thus Lp and Lq may be glued together over a two-dimensional quotient via [9], and this is our lattice. Notice that if F and K were finite fields we could not carry out the above construction since two-dimensional quotients of Lp would have/)" + 1 atoms and those of Lq would have qm + 1, for some n, m > 1. However these numbers are never equal. To some extent the proof is based on this fact. We prove our result by letting / be a homomorphism from a modular lattice M onto our lattice L. A great deal of the structure of L can be pulled back through / into M. We then assume M is residually finite and using von Neumann's theorem arrive at a contradiction similar to the one described above. K. Baker [1] and R. Wille [20] have constructed varieties of modular lattices not generated by their finite members. Using a lattice constructed by E. T. Schmidt [18] the author has shown there is a variety of modular lattices not even generated by its finite dimensional members [6]. However, Schmidt's