The stability of open edged multi-walled carbon nanotubes has been investigated by using in situ high resolution transmission electron microscopy at elevated temperatures. Formation of inter-shell structures was experimentally observed for the first time and attributed to a robust interaction between adjacent concentric shells (so-called lip–lip interaction). The fluctuating behavior of the inter-shell structures suggests a mechanism by which the carbon atoms can pass in or out through the inter-shell edges during carbon nanotube growth or shrinkage processes.