The thyroid gland of vertebrates is considered to be homologous to the endostyle of non-vertebrate chordates (cephalochordates, urochordates), a key character for understanding the origin and evolution of the chordate body plan. In lampreys, the larval endostyle transforms into an adult thyroid gland during metamorphosis, reflecting evolutionary changes that occurred in the vertebrate lineage. Focussing on thyroid-like cells in the endostyle, we here relate morphologically visible steps of lamprey (Lampetra fluviatilis) endostyle differentiation to embryonic stages and determine the onset of thyroid-like function. Analysing lamprey endostyle development using semi-thin histological sections, immunohistochemical detection of thyroid hormone, and the molecular marker thyroid transcription factor1 (Ttf1) refines our current view of the homology between endostyle and thyroid gland. In contrast to earlier literature, we find that a duct always persists to connect the endostyle lumen to the pharynx, a structure that resembles the thyroglossal duct in thyroid development and could further support the homology between endostyle and thyroid. Before the onset of thyroid-like function, Ttf1 expression becomes restricted to the ventral part of the endostyle, on the one hand showing that dorsal thyroid-like cells produce thyroid hormone in the absence of Ttf1, and on the other suggesting that Ttf1 was initially involved in specifying ventral fates in the endostyle.