To identify the specific locations of type 2 deiodinase (D2) messenger RNA (mRNA) in the hypothalamus and pituitary gland and determine its regulation by thyroid hormone, we performed in situ hybridization histochemistry, Northern analysis, and quantitative RT-PCR in euthyroid, hypothyroid, and hyperthyroid rats. By in situ hybridization histochemistry, silver grains were concentrated over ependymal cells lining the floor and infralateral walls of the third ventricle extending from the rostral tip of the median eminence (ME) to the infundibular recess, surrounding blood vessels in the arcuate nucleus (ARC), and in the ME adjacent to the portal vessels and overlying the tuberoinfundibular sulci. Silver grains also accumulated over distinct cells in the midportion of the anterior pituitary. In hypothyroid animals, an increase in signal intensity was observed in the caudal hypothalamus, and a marked increase in the number of positive cells occurred in the anterior pituitary. Microdissection of the hypothalamus for Northern and PCR analysis established the authenticity of D2 mRNA in the caudal hypothalamus, and confirmed that the majority of D2 mRNA is concentrated in this region. The distribution of D2 mRNA suggests its expression in specialized ependymal cells, termed tanycytes, originating from the third ventricle. Thus, the tanycyte is the source of the high D2 activity previously found in the ARC-ME region of the hypothalamus. The results indicate that tanycytes may have a previously unrecognized integral role in feedback regulation of TSH secretion by T₄.