We have identified a dominant fetal thymocyte population at day 14.5 of gestation in the mouse that lacks CD4 and CD8 but expresses Fc gamma RII/III several days prior to acquisition of the T cell receptor (TCR) in vivo. If maintained in a thymic microenvironment, this population of CD4-CD8-TCR-Fc gamma RII/III+ thymocytes differentiates first into CD4+CD8+TCRlowFc gamma RII/III- thymocytes and subsequently CD4+CD8-TCRhighFc gamma RII/III- and CD4-CD8+TCRhighFc gamma RII/III- mature Ti alpha-beta lineage T cells. However, if removed from the thymus, the CD4-CD8-TCR-Fc gamma RII/III+ thymocyte population selectively generates functional natural killer (NK) cells in vivo as well as in vitro. These findings show that a cellular pool of Fc gamma RII/III+ precursors gives rise to T and NK lineages in a microenvironment-dependent manner. Moreover, they suggest a hitherto unrecognized role for Fc receptors on primitive T cells.