Experiments with rats and hamsters have provided evidence for an inhibitory action of the pineal gland on the neuroendocrine-thyroid axis. While maintenance of these animals in short photoperiod results in reduced levels of circulating thyroxin (T4), pinealectomy restores the levels to normal. Recent studies suggest that an active pineal gland produces a substance which inhibits thyrotrophin-releasing hormone release from the hypothalamus. Several investigators have concluded that endogenous melatonin, produced in the pineal gland, could account for the inhibitory action of the pineal gland on blood T4 levels. Although melatonin administration has been reported to inhibit blood T4 levels in both rats and hamsters, under certain experimental conditions melatonin administration can be demonstrated to have a counter-antithy-rotrophic effect resulting in increased blood levels of T4 and thyrotrophin. Assay of blood levels of melatonin of rats and hamsters under various experimental conditions will be necessary to distinguish physiological from pharmacological effects of melatonin. Lesion studies as well as studies with melatonin implants in the brain, suggest that the site of action is in the anterior hypothalamus. The effects of melatonin on the neuroendocrine-thyroid axis are similar to its effects on the neuroendocrine-gonadal axis, leading to the hypothesis of a common site of action for the thyroid and gonadal effects of melatonin. Although many pineal ‘factors’ have been postulated to account for the action of this gland, an action of melatonin on the serotonergic system of the brain stem could account for the data.