The type 2 iodothyronine deiodinase (D2) is critical for the intracellular production of 3,5,3'-triiodothyronine from thyroxine. The D2 mRNA of higher vertebrates is over 6 kilobases (kb), and no complete cDNA clones have been reported. Using 5'- and 3'-rapid amplification of cDNA ends and two cDNA libraries, we have cloned the 6094-base pair fall-length chicken D2 cDNA. The deduced protein is similar to 31 kDa and contains two in-frame UGA codons presumably encoding selenocysteine. One of these is in the highly conserved active catalytic center; the other is near the carboxyl terminus. Unusual features of the cDNA include a selenocysteine insertion sequence element similar to 4.8 kb 3' to the UGA codon in the active center and three short open reading frames in the 5'-untranslated region. The K-m of D2 is similar to 1.0 nM for thyroxine, and the reaction is insensitive to inhibition by 6-n-propylthiouracil. Chicken D2 is expressed as a single transcript of similar to 6 kb in different brain regions and in the thyroid and lung. Hypothyroidism increases D2 mRNA in the telencephalon, Unlike in mammals, D2 mRNA and activity are expressed in the liver of the chicken, suggesting a role for D2 in the generation of plasma 3,5,3'-triiodothyronine in this species.