Recently, a translocation t(2;3)(q13;p25), leading to the formation of a chimeric PAX8-peroxisome proliferator-activated receptor (PPAR)gamma 1 oncogene, was detected in follicular thyroid carcinomas (FTC), but not in follicular thyroid adenomas (FTA), papillary thyroid carcinomas (PTC), or multinodular hyperplasias. However, previous cytogenetic studies have identified the t(2;3)(q13;p25) translocation also in some cases of FTA. In this study, we have combined RT-PCR with primers in exons 4-8 of PAX8 and in exon 1 of PPAR gamma 1 with PPAR gamma immunohistochemistry to study PAX8-PPAR gamma 1 oncogene activation in FTC (n = 9), FTA (n = 16), PTC (n = 9), anaplastic thyroid carcinomas (n = 4), and multinodular hyperplasias (n = 2). PAX8-PPAR gamma 1 rearrangements were detected by RT-PCR in 5 of 9 (56%) FTC and in 2 of 16 (13%) FTA. By contrast, all cases of PTC, anaplastic thyroid carcinomas, and multinodular hyperplasia were RT-PCR-negative. Diffuse nuclear immunoreactivity for PPAR gamma was observed in 7 of 9 (78%) FTC, 5 of 16 FTA (31%), and 1 of 9 PTC (11%). Positivity was focal in 3 cases (1 FTC, 1 PTC, and 1 multinodular hyperplasia). Diffuse nuclear staining for PPAR gamma was present in RT-PCR- negative cases of FTC (n = 3), FTA (n = 3), and PTC (n = 1), suggesting that a different PAX8-PPAR gamma 1 breakpoint, a rearrangement between PPAR gamma 1 and a non-PAX8 partner, or overexpression of the native protein might be present. Our findings that PAX8-PPAR gamma 1 rearrangements are present in both follicular carcinomas and adenomas suggest that this oncogene is not a reliable marker to differentiate between FTC and FTA in fine-needle aspiration biopsies of follicular neoplasms of the thyroid.