The mouse thymus was assessed for its ability to produce steroids. Cultured thymic non-T cells produced soluble pregnenolone and deoxycorticosterone, and immunohistochemistry demonstrated steroidogenic enzymes in radioresistant thymic epithelial cells but not in thymocytes. Inhibition of thymic corticosterone production or blockade of the glucocorticoid receptor with RU-486 resulted in enhanced TCR-mediated, antigen-specific deletion of immature thymocytes. These data indicate that locally produced glucocorticoids, because of their antagonism of TCR-mediated signaling for death, may be a key element of antigen-specific thymocyte selection.