Fetal thymic and adult epithelial V gamma 3(+) and V gamma 4(+) T cells express gamma delta antigen receptors (TCR) with invariant junctions lacking N nucleotides. Using transgenic recombination substrates, we show that di- or trinucleotide repeats, either in the coding region or in P elements, have strong effects on the site of recombination. In other mice bearing a terminal deoxynucleotidyl transferase (TdT) transgene under the control of the CD2 promoter, we found that the frequency of canonical junctions was markedly reduced with a concomitant increase in in-frame noncanonical junctions with N nucleotides. Together, our results show that short homology repeats direct the site of rearrangement and thus play a critical role in the generation of gamma delta T cell receptor canonical junctions. Increased TdT activity in V gamma 3(+) T cells has a inhibitory effect on junctional homogeneity in these cells.