Direct cross-sectional observations of graphene-on-SiC (0001) by high-resolution transmission electron microscopy have revealed the presence of a metastable transitional structure formed by decomposition of a single SiC bilayer as well as fully-packed honeycomb graphene as an interface structure between graphene and SiC. A first principles calculation studied in parallel has clarified that the metastable transitional state exhibits the metallic behavior, while the fully-packed honeycomb graphene exhibits the semiconducting behavior. (C) 2008 Elsevier B. V. All rights reserved.