To study conversion of 3,5,3'-triiodothyroinine (T3) and 3,3',5'-triiodothyronine (rT3) to 3,3'-diiodothyronine (T2) in vitro, T3 or rT3 was incubated at pH 7.35 with homogenates of several rat tissues (liver, kidney, muscle, heart, ling, spleen, intestines, and brain) for 15 min at 37 C. The T2 generated during incubation was measured in an ethanol extract of the incubation mixture by a specific RIA of T2; T4, T3, and rT3 cross-reacted in the T2 RIA only to an extent of 0.006, 0.2, and 0.04%, respectively. T2 was produced regularly when T3 or rT3 was incubated with liver or kidney homogenates; other tissues generated little or no T2 under similar conditions. Studies with liver homogenates revealed that production of T2 from both T3 and rT3 was influenced significantly by tissue and substrate concentractions, temperature, pH and duration of incubation. T3- as well as rT3-monodeiodinating activities were unaffected by large doses (greater than or equal to 3 micrometer) of sodium iodide, diiodotyrosine, and methimazole, but were inhibited in a dose-dependent manner by propylthiouracil, iodiacetic acid, and dinitrophenol. The apparent Km for conversion of T3 to T2 approximated 6.0 micrometer and that for conversion of rT3 to T2' 65 nM. Propylthiouracil and iodoacetic acid inhibited conversion of both T3 and rT3 to T2 in an uncompetititve and a non-competitive manner, respectively. The various data suggest that 1) monodeiodination of T3 and rT3 to T2 is enzymic in nature; 2) liver and kidney may be the major sites of metabolic transformations of T3 and rT3 to T2.