Hepatic microsomal enzymes play an important role in thyroid hormone homeostasis. Glucuronidation of thyroxine is the rate limiting step in the biliary excretion of thyroxine in the rat; the monodeiodinases are important in the conversion of T4 to T3 and reverse T3 and subsequent deiodinations. Phenobarbital is known to affect thyroid function in rats due to an alteration of hormone disposition. We have further characterized these effects and have demonstrated that phenobarbital increases the biliary excretion of thyroxine glucuronide primarily as a result of an induction of hepatic thyroxine glucuronyltransferase. Studies on the mode of action for phenobarbital promotion of thyroid follicular neoplasia were conducted using an initiation-promotion model established by Hiasa et al (35). In this model, we demonstrated that supplemental administration of thyroxine blocked the promoting effect of phenobarbital and furthermore, using various dosages of thyroxine, we observed that the tumor promoting effect of phenobarbital was directly proportional to the level of plasma TSH. The results of these studies support the hypothesis that the tumor promoting effect of phenobarbital in the thyroid gland is mediated via increased secretion of pituitary TSH as a compensatory response to the known effects of phenobarbital on peripheral thyroid hormone disposition. Since a number of microsomal enzyme inducing agents have increased the incidence of thyroid follicular neoplasia in rat carcinogenicity studies, thyroid function should be assessed and a secondary mechanism of hormone imbalance should be considered in the interpretation of the significance of these findings in rodents.