We studied two sisters who developed large non-toxic goitres in adolescence. Deiodinase deficiency was diagnosed by a rapid thyroid uptake of radioactive iodine (RAI) at 2 hours associated with a marked fall in thyroidal 131I by 24 hours. Serial RAI scans in the second patient documented evolution of the iodine-deficient state. Conservation of intra-thyroidal iodine stores was maintained by avid iodine uptake and failure to release organified 131I. With progressive loss of inorganic iodine, hypothyroidism developed, associated with a rise in serum TSH which further exacerbated the loss of iodine. Treatment with L-thyroxine resulted in an improvement of thyroid function, but normalization was achieved only after small doses of Lugol's iodine were administered. These studies illustrate the variable nature and late onset of an inborn error of thyroid metabolism. This family supports an autosomal recessive mode of inheritance for deiodinase deficiency. We have documented progression from a euthyroid to hypothyroid state resulting from decompensation of iodine conservation mechanisms.