Clinicians have long recognized that congenital deficiency of iodine (a component of thyroid hormone) somehow damages the human embryonic nervous system, causing sensori-neural deafness. Recently, a deletion encompassing most of the human beta thyroid hormone receptor (TR beta) gene has been found in children who are neurologically normal except for one striking defect: profound sensori-neural deafness. We now show that the TR beta gene is prominently expressed very early in rat inner ear development. This expression is remarkable because both TR beta 1 and TR beta 2 mRNAs are restricted, as early as embryonic day 12.5, to that portion of the embryonic inner ear that gives rise to the cochlea, the structure responsible for converting sound into neural impulses. The timing of this expression, when correlated with human inner ear development, raises the possibility that TRs may act in human ontogenesis earlier than previously suspected. These results provide a rare correlation between a specific human neurologic deficit (deafness) and transcription factor expression in a highly discrete embryonic cell population (ventral otocyst). TR alpha gene expression is also prominent in the developing cochlea, but, in contrast to the restricted pattern of TR beta gene expression, TR alpha 1 and TR alpha 2 transcripts are also found in inner ear structures responsible for balance. Deafness in children homozygous for a large deletion in the TR beta gene suggests that cochlear alpha 1 TRs cannot functionally compensate for the absence of TR beta 1 and TR beta 2. The developing inner ear may, therefore, represent an example of TR isoform-specific transcriptional regulation in vivo.