A key issue in the mechanism of thyroglobulin (Tg) iodination by thyroperoxidase (TPO) is whether a TPO-bound iodine intermediate directly iodinates Tg-incorporated tyrosines (specific iodination) or whether reactive iodine species released from TPO effectuate Tg iodination (nonspecific iodination). We addressed these alternatives by (a) determining the aqueous equilibria of the iodine species potentially involved in the kinetic studies of TPO-mediated iodination, and (b) reviewing the structure of the substrate channel in mammalian peroxidases. Redox-potentiometric analysis of aqueous iodine combined with integrated mathematical modelling demonstrates that I2 reacts with water to form several iodine species including hypoiodious acid (HOI). The HOI/I2 ratio depends on time, iodide concentration, buffering agents, and pH varying dramatically from pH 4 to 7.4. These factors may confound the use of Michaelis-Menten kinetics to determine the mechanism of TPO-catalyzed iodination since both I2 and HOI iodinate tyrosine but with different specificities and reaction rates. Consequently there is as yet no conclusive kinetic evidence that iodination occurs via formation of a TPO-bound iodinated intermediate. Furthermore, knowledge of TPO structure, gained from X-ray crystallographic studies indicates that access of Tg-bound tyrosyl groups to the active site of TPO is not possible. Thus the emerging conclusion is that the mechanism of Tg iodination is nonspecific. This is consistent with the occurrence of thyroid hormone formation in prevertebrate ascidians which exhibit TPO-like activity but lack the Tg gene.