Scientific American

First, the caterpillar digests itself, releasing enzymes to dissolve all of its tissues. But the contents of the pupa are not entirely an amorphous mess. Certain highly organized groups of cells known as imaginal discs ( klicka ) survive the digestive process. Before hatching, when a caterpillar is still developing inside its egg, it grows an imaginal disc for each of the adult body parts ( klicka ) it will need as a mature butterfly —discs for its eyes, for its wings, its legs and so on. 

In some species, these imaginal discs remain dormant throughout the caterpillar's life; in other species, the discs begin to take the shape of adult body parts even before the caterpillar forms a chrysalis or cocoon. 

Once a caterpillar has disintegrated all of its tissues except for the imaginal discs, those discs use the protein-rich soup all around them to fuel the rapid cell division required to form the wings, antennae, legs, eyes, genitals and all the other features of an adult butterfly or moth. The imaginal disc for a fruit fly's wing, for example, might begin with only 50 cells and increase to more than 50,000 cells ( klicka ) by the end of metamorphosis. Depending on the species, certain caterpillar muscles and sections of the nervous system are largely preserved in the adult butterfly.