We describe a new cellular component of normal mouse thymuses, which is isolated by fractionated trypsin dissociation of minced thymus tissue followed by repeated unit gravity sedimentation. These cells are of unusually large size, with diameters of 30 μm and more. They represent cellular complexes of single large cells filled with high numbers of lymphoid cells. The majority of the engulfed lymphoid cells is not only fully intact, as judged by morphological criteria, but, moreover, includes a high proportion of mitotic figures. Electron microscopic investigations reveal the epithelial character of the large thymic nurse cells (TNC). The peripherally situated cytoplasmic tonofilament streams, and characteristic vacuoles filled with coarse, unidentified material, closely resemble cytoplasmic organelles found in the cortical reticuloepithelial cells described in situ. The internalized lymphocytes are located within caveolae lined by plasma membranes. These TNC caveolae are completely sequestered, and have lost any communication with the extracellular space, as demonstrated by the inability of an electrondense marker, cationized ferritin, to diffuse into the perilymphocytic clefts. The structural interactions between the membranes of the engulfed thymocytes with the surrounding TNC caveolar membranes were investigated both in ultrathin sections and in freeze-etch preparates. Two distinct contact types between both membranes were discerned: (a) complete, close contact along the entire lymphocyte circumference, and (b) more frequently, contact restricted to discrete, localized areas. Judging from their size and distribution, the localized contacts could correspond particle aggregates of freeze-etch preparates, which morphologically resemble certain stages of gap junction. Furthermore, we regularly found square arrays of particles of uniform size, which so far have been thought to be typical for cell membranes actively engaged in ion exchange. Tight junction-like particle arrays, which were present on TNC outer membranes, and probably represented disrupted contacts between adjacent TNC in the intact tissue, could not be found on caveolar or lymphocyte membranes. Finally, one of the most conspicuous specializations of the TNC caveolar membrane were membrane invaginations, which were arranged mainly in groups, and which probably reflect endo- or exocytotoxic events. We investigated the surface antigen phenotype of TNC by indirect immunofluorescence, with monoclonal antibodies against determinants of H-2- complex subregions as well as against lymphocyte differentiation markers. Semiquantification was reached with flow cytofluorimetry, followed by morphological control by fluorescence microscopy. The surface antigen formula of TNC is: Ig(-), Thy-l(-), H-2K(++), I-A (++), I-E/C(+), H-D(++), Ly-1(-), Ly-2(-), Qat-4(-), Qat-5(-), and peanut agglutinin (PNA)(-). Thymic macrophages, which were identified by double fluorescence, with rhodamine- coupled zymosan as a phagocytosis marker, were serologically identical with TNC. Free thymocytes, in contrast, had the following antigen formula: Ig(-), Thy-1(++), H-2K(+/-), I-A(-), I-E/C(-), H-2D(+/-), Ly-1(+/-), Ly-2(+), Qat- 4(-), Qat-5(-), and PNA(+). The unprecedented finding of high numbers of dividing thymocytes sojourning within thymic epithelial cells, and the particular specializations of the TNC caveolar membranes surrounding these engulfed thymocytes is the basis of a hypothesis that postulates that an intraepithelial differentiation cycle is one essential step in, intrathymic T lymphocyte generation.