Saturn's outermost (E) ring appears to be closely related to its satellite Enceladus. The radial optical profile of the E ring and ssytematic trends in the albedos of the seven Saturnian satellites residing within the E ring suggest that Encedadus bears a generative relationship to the E ring. An examination of the microphysical properties of the ring particles elucidates this relationship. Matching the phase function of the E ring requires dielectric spheres, and its blue color, a narrow size distribution. Limits are also placed on their complex refractive index. All observed optical and infrared properties of Saturn's E ring can be explained in terms of Mie scattering by a narrow size distribution of ice spheres with an effective diameter of 2-2.5 μm and an effective variance of 0.1-0.15. The spheriucal shape of the ring particles and their narrow size distribution imply that they have a molten origin, followed by quick freezing. Continued replenishment of the E ring by volcanic eruptions on Encedadus seems quite plausibvle, considering all available evidence. The recent discovery of tectonic activity on Enceladus supports our conclusions. Although both exogenic and endogenic hypotheses on the origin of the E ring are consistent with the gross macrostructure of the E ring and systematic trends in the albedos of the satellites, only episodic volcanic injections of particles into the E-riong can explain the coexistence of the diverse ring structures. We compared the relationship between Encedadus and the E ring with that between Io and Io's torus and discovered many parallels, which are useful in understanding outer solar system volcanism and ring formation.