Large variations exist in thyrotropin (TSH) and thyroid hormones in serum. The components of variation include preanalytical, analytical, and biologic variation. This is divided into between- and within-individual variation. The latter consists of circadian and seasonal differences although there are indicators of a genetically determined starting point. The ratio of within- to between-individual variation describes the reliability of population-based reference ranges. This ratio is low for serum TSH, thyroxine (T(4)) and triiodothyronine (T(3)) indicating that laboratory reference ranges are relatively insensitive to aberrations from normality in the individual. Solutions are considered but reducing the analytical variation below the calculated analytical goals of 7%, 5% and 12% for serum T(3), T(4), and TSH does not improve diagnostic performance. Neither does determination of the individual set-point and reference range. In practice this means that population-based reference ranges are necessary but that it is important to recognize their limitations for use in individuals. Serum TSH responds with amplification to minor alterations in T(4) and T(3). A consistently abnormal TSH probably indicates that T(4) and T(3) are not normal for the individual even when inside the laboratory reference range. This underlines the importance of TSH in diagnosis and monitoring of thyroid dysfunctions. Also, it implies that subclinical thyroid disease may be defined in purely biochemical terms. Under critical circumstances such as pregnancy where normal thyroid function is of importance for fetal brain development, subclinical thyroid disease should be treated. Even TSH within the reference range may be associated with slightly abnormal thyroid function of the individual. The clinical importance of such small abnormalities in thyroid function in small children and pregnant women for brain development remains to be elucidated.