This paper characterizes the stability and orthonormality of the shift
s of a multidimensional (M,c) refinable function phi in terms of the e
igenvalues and eigenvectors of the transition operator W-cau defined b
y the autocorrelation c(au) of its refinement mask c, where M is an ar
bitrary dilation matrix. Another consequence is that if the shifts of
phi form a Riesz basis, then W-cau has a unique eigenvector of eigenva
lue 1, and all of its other eigenvalues lie inside the unit circle. Th
e general theory is applied to two-dimensional nonseparable (M,c) refi
nable functions whose masks are constructed from Daubechies' conjugate
quadrature filters.