Ample clinical evidence indicates that women with thyroid disorders frequently exhibit menstrual disturbances and impaired fertility. In order to characterize the nature of thyroid hormone action in the ovary, the direct effects of triidothyronine (T3) were investigated in vitro using a culture system of human luteinized granulosa cells. The presence of T3 receptors was also searched in such cells. The cell cultures were maintained in serum-free Ham's F-10 medium in the absence or presence of hCG, with or without graded doses of T3 (10(-11)-10(-7) M), and cell proliferation (assessed by DNA content) as well as cell function (cAMP accumulation and progesterone secretion) determined. T3 alone stimulated cell proliferation. hCG, on the other hand, was anti-mitogenic and T3 combined with hCG inhibited cell growth even further, reaching levels below those reached by either control or hCG alone. Exposure of cells to T3 markedly enhanced hCG-induced cAMP accumulation. Addition of 1-methyl-3-isobutylxanthine (MIX) abolished the cAMP-stimulatory effect elicited by T3, suggesting that the thyroid hormone may act, as MIX, by inhibiting phosphodiesterase. T3 was devoid of any influence on basal progesterone secretion, but inhibited hCG-induced secretion of the steroid. The effects of T3 are not accounted for by changes in cell number since the influence of thyroid hormone on cAMP and steroid secretion were expressed per mug DNA. The action of thyroid hormone on ovarian function and growth may be receptor-mediated since saturable, high affinity (K(D) = 4.2 +/- 0.8 x 10(-10) M), low capacity (1510 +/- 152 fmol/mg DNA) T3 binding sites were found in the nuclei of human luteinized granulosa cells. Optimal conditions for T3 binding to the nuclei of such cells were determined. In conclusion, we have demonstrated that human luteinized granulosa cells contain thyroid hormone binding sites and that these cells serve as target to T3 action, in particular T3 modulating hCG-mediated ovarian cell proliferation and function. Our in vitro data of a direct T3 ovarian influence may account for the in vivo indications of a thyroid-ovarian connection.