MHC class I molecules are highly polymorphic within populations. This diversity is thought to be the result of selective maintenance of new class I alleles formed by gene conversion. It has been proposed that rare alleles are maintained by their ability to confer resistance to common pathogens. Investigation has focused on differences in the presentation of foreign Ags by class I alleles, but the majority of peptides presented by class I molecules are self peptides used in shaping the naive T cell repertoire. We propose that the key substrate for the natural selection of class I gene conversion variants is the diversity in immune potential formed by new alleles. We show that T cells compete with each other for niches in the thymus and spleen during development, and that competition between different clones is dramatically affected by class I mutations. We also show that peripheral naive T cells proliferate preferentially in the presence of the class I variant that directed T cell development. The data argue that class I gene conversion mutations dramatically affect both the development and the maintenance of the naive CD8 T cell repertoire.