1. Appropriate distribution of thyroxine between the lipid-soluble compartments of cells and tissues and the extracellular aqueous space is established by binding to extracellular proteins. Among these proteins, transthyretin is of particular interest because it is the only one synthesized in the brain. 2. The evolutionary onset of transthyretin synthesis in cells of the blood-brain barrier precedes that in the liver, with the exception of a very short period of transthyretin synthesis in the liver of tadpoles, just prior to the climax of metamorphosis. In adult liver, transthyretin is only synthesized in endothermic vertebrates. 3. The affinity of transthyretin for thyroxine increases and that for 3,5,3'-triiodothyronine decreases during the evolution of eutherians from reptile/bird-like common ancestors. 4. A systematic change of the N-terminal region of transthyretin occurred during evolution, leading to shorter and more hydrophilic transthyretin N termini in eutherians compared with those in reptiles and birds. 5. The molecular mechanism of the evolution of the transthyretin N termini is a stepwise shift of the splice site at the intron 1/exon 2 border in the 3' direction. The most probable cause for this shift is a series of single base mutations. 6. As the N termini are located on the surface of transthyretin near the entrance to its central channel leading to the thyroxine binding sites, it is possible that a change in the structure of this region could influence the access of thyroxine to the binding sites. The increase in affinity for thyroxine could then be a driving force in the natural selection during evolution of transthyretins with shorter and more hydrophilic N termini.