There is a profound difference in the incidence of thyroid disease between males and females. We have investigated the possibility of a direct effect of sex steroids on the thyroid gland by investigating thyroid function in castrate animals. The rate of thyroid hormone release was estimated by measuring the rate of hydrolysis of labeled thyroglobulin from mouse thyroid glands in vitro. The thyroid glands were labeled in vivo with 131I and then cultured for 20 h in the presence of mononitrotyrosine, an inhibitor of iodotyrosine and deiodinase. The rate of hydrolysis of labeled thyroglobulin was measured as the percentage of radioactivity released as iodotyrosines and iodothyronines into the gland and the medium at the end of incubation. TSH was injected at varying intervals before death in some cases. The basal rates of thyroglobulin hydrolysis were similar in intact and castrate mice, but TSH-stimulated rates were significantly higher in both male and female castrates. Daily treatment of castrates for a week with estradiol or testosterone decreased the rate of thyroglobulin hydrolysis to that seen in intact mice, but dihydrotestosterone was without effect. (Bu)2cAMP added in vitro increased the rate of thyroglobulin hydrolysis in both intact and castrate mice, but the stimulation was significantly greater in the castrates. Basal and TSH-stimulated cAMP levels in the thyroid were similar in castrate and intact mice. There was no difference in thyroidal incorporation of iodine by intact and castrate mice in either presence or absence of TSH. These data suggest the following. 1) Castration results in significantly greater sensitivity to TSH with respect to thyroid hormone secretion. Thyroid hormone synthesis, basal or TSH-stimulated, is, however, unaltered. 2) Estradiol inhibits TSH-stimulated hormone release in castrates. Testosterone has a similar effect, possibly through aromatization to estradiol. 3) The effect of sex hormones is likely to be exerted at a post-cAMP step specific for hormone secretion.