Selection processes in the thymus eliminate nonfunctional or harmful T cells and allow the survival of those cells with the potential to recognize Ag in association with self-MHC-encoded molecules (Ag/MHC). We have previously demonstrated that thymus-derived glucocorticoids antagonize TCR-mediated deletion, suggesting a role for endogenous thymic glucocorticoids in promoting survival of thymocytes following TCR engagement. Consistent with this hypothesis, we now show that inhibition of thymus glucocorticoid biosynthesis causes an increase in thymocyte apoptosis and a decrease in recovery that are directly proportional to the number of MHC-encoded molecules present and, therefore, the number of ligands available for TCR recognition. Expression of CD5 on CD4+CD8+ thymocytes, an indicator of TCR-mediated activation, increased in a TCR- and MHC-dependent manner when corticosteroid production or responsiveness was decreased. These results indicate that thymus-derived glucocorticoids determine where the window of thymocyte selection occurs in the TCR avidity spectrum by dampening the biological consequences of TCR occupancy and reveal that glucocorticoids mask the high percentage of self-Ag/MHC-reactive thymocytes that exist in the preselection repertoire.