The coating and granulation of solid particles in a fluidized bed is a process which converts pumpable and atomizable liquids (solutions, slurries, melts) into granular solids in one step by means of drying. The solution to be processed is sprayed onto a fluidized bed. Particle growth can take place either via surface layering or agglomeration. In the case of surface layering the atomized droplets deposit a thin layer of liquid onto the seed particles. The solvent is then evaporated by the hot fluidizing, leaving behind the dissolved material on the surface. Although fluidized bed spray granulation and film coating have been applied in industry for several years, there is still a lack of understanding of the physical fundamentals and the mechanisms by which spherical granules are formed. Hence a new method was developed which allows the direct observation of the subsequent particle-forming mechanisms such as droplet deposition, spreading, wetting and drying. The authors present a laboratory scale apparatus in which a single freely suspended particle can be coated under well defined and constant coating and drying conditions. With this device, particle-growth-rate and the development of particle morphology were measured and investigated under various experimental conditions.