Initial growth stages of Ge on Si (111) are studied from the viewpoint of intermixing of Si into the epitaxial Ge layer. Defect formation in the Ge islands was characterized by using moiré patterns taken by transmission electron microscopy (TEM). Ge islands are grown by MBE on Si(111) surfaces with an SPE-grown buffer layer, which is expected to prevent intermixing between the epitaxial Ge layer and the Si substrate. Anomalous Si incorporation into the Ge islands is analyzed by TEM moiré fringe analysis. Dislocations are visualized by means of extra 'half-lines' of the moiré fringes, and thus Burgers vectors are determined. Stacking faults are observed by a displacement of the fringe spacings Coalescence of the Ge islands and dislocation generation from the contact part of the islands are detected.