We apply ideas of the parquet-diagram and optimized Fermi-hypernetted chain methods to determine the short-range structure of the pair wave function in neutron matter and compare these with Bethe-Goldstone results and those of low-order variational calculations. It is shown that the induced interaction, describing the exchange of density, spin, and tensor fluctuations, has a profound influence on the short-ranged structure of the pair wave function and, hence, on effective interactions in neutron matter.