When an inline box contains an in-flow block-level box, the inline box (and its inline ancestors within the same line box) are broken around the block-level box (and any block-level siblings that are consecutive or separated only by collapsible whitespace and/or out-of-flow elements), splitting the inline box into two boxes (even if either side is empty), one on each side of the block-level box(es). The line boxes before the break and after the break are enclosed in anonymous block boxes, and the block-level box becomes a sibling of those anonymous boxes. When such an inline box is affected by relative positioning, any resulting translation also affects the block-level box contained in the inline box.
This model would apply in the following example if the following rules:
p { display: inline }
span { display: block }
were used with this HTML document:
<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01//EN">
<HEAD>
<TITLE>Anonymous text interrupted by a block</TITLE>
</HEAD>
<BODY>
<P>
This is anonymous text before the SPAN.
<SPAN>This is the content of SPAN.</SPAN>
This is anonymous text after the SPAN.
</P>
</BODY>
The P element contains a chunk (C1) of anonymous text followed by a block-level element followed by another chunk (C2) of anonymous text. The resulting boxes would be a block box representing the BODY, containing an anonymous block box around C1, the SPAN block box, and another anonymous block box around C2.
The properties of anonymous boxes are inherited from the enclosing non-anonymous box (e.g., in the example just below the subsection heading "Anonymous block boxes", the one for DIV). Non-inherited properties have their initial value. For example, the font of the anonymous box is inherited from the DIV, but the margins will be 0.
Properties set on elements that cause anonymous block boxes to be generated still apply to the boxes and content of that element. For example, if a border had been set on the P element in the above example, the border would be drawn around C1 (open at the end of the line) and C2 (open at the start of the line).
Some user agents have implemented borders on inlines containing blocks in other ways, e.g., by wrapping such nested blocks inside "anonymous line boxes" and thus drawing inline borders around such boxes. As CSS1 and CSS2 did not define this behavior, CSS1-only and CSS2-only user agents may implement this alternative model and still claim conformance to this part of CSS 2.1. This does not apply to UAs developed after this specification was released.
Make of that what you will. Clearly the behaviour is specified in CSS, although whether it covers all cases, or is implemented consistently across today's browsers is unclear.
