Production of 3,3'-di-iodothyronine (3,3'-T2) from 3,3',5'-tri-iodothyronine (reverse T3, rT3) as catalysed by rat liver microsomal fraction was measured with a specific radioimmunoassay. The effect of the addition of 2-thiouracil and of varying concentrations of cofactor (dithiothreito) on the kinetic parameters of this reaction were studied. It was found that thiouracil is an uncompetitive inhibitor with respect to substrate and a competitive inhibitor with respect to cofactor. The effect of a decrease in the concentration of cofactor was similar to the effect of addition of thiouracil, i.e. a proportional decrease in Km and V. The results strongly suggest that enzymatic 5'-deiodination of iodothyronines follows a ping-pong mechanisms, which may be envisaged as a transiodination and the subsequent reduction of the iodo-enzyme complex by cofactor. The intermediate is probably a sulfenyl iodide form of the enzyme, which reacts with thiouracil to yield a mixed disulfide.