A central paradigm of T cell development is that CD4+8+ (DP) thymocytes differentiate into CD4+ or CD8+ T cells in response to intrathymic signals that extinguish transcription of the inappropriate coreceptor molecule. Contrary to this prevailing paradigm, we now demonstrate that signaled DP thymocytes initially terminate CD8 transcription even when differentiating into CD8+ T cells. Remarkably, thymocytes that have selectively terminated CD8 transcription can be signaled by IL-7 to differentiate into CD8+ T cells by silencing CD4 transcription and reinitiating CD8 transcription, events we refer to as "coreceptor reversal." These observations significantly alter our understanding of CD8+ T cell differentiation and lead to a new perspective ("kinetic signaling") on CD4/CD8 lineage determination in the thymus. These observations also suggest a novel mechanism by which bipotential cells throughout development can determine their appropriate cell fate.