We describe an in vitro system in which positive selection of developing T cells takes place on defined stromal cell preparations, which include major histocompatibility complex class II+ epithelial cells but exclude cells of bone marrow origin. In this system, maturation of double-positive T cell receptor negative (TCR-), CD4+8+ thymocytes into single-positive TCR+, CD4+ and CD8+ cells takes place together with the development of functional competence. As in vivo, this maturation is associated with the upregulation of TCR levels as cells progress from double-positive to single-positive status. We also show that class II+ epithelial cells in these cultures are less efficient than dendritic cells in mediating the deletion (negative selection) of V beta 8+ cells by the superantigen staphylococcal enterotoxin B. For the first time, this approach provides a model in which the cellular interactions involved in both positive and negative selection can be studied under controlled in vitro conditions.