PERIPHERAL CD4⁺ and CD8⁺ T lymphocytes carry out different functions during immune reactions, partly as a result of the distinct patterns of lymphokines that they secrete upon stimulation. Using thymic cells from adult and newborn mice as well as from fetal organ cultures, we show here that this functional differentiation occurs inside the thymus and is completed during the single positive stage by the time the T-cell receptor becomes fully coupled to the intracellular activation pathways leading to lymphokine secretion. Surprisingly, CD4⁺8⁻ thymocytes differ from their immediate progeny, naive peripheral CD4⁺ cells, in that they secrete a broader range of lymphokines, including interleukins 4, 5 and 10 and ^γ-interferon, and more closely resemble immunologically experienced (activated or memory) CD4⁺ lymphocytes.