Treatment of Graves' disease patients with radioactive iodide (RAI) can induce two therapeutically important alterations in immune response to thyroid antigens. These may be characterized as a first response and a second phase response. Initial treatment of patients with Graves' disease by RAI leads to killing of thyroid cells and releases antigen into the circulation. In association with this, there is a dramatic increase in levels of thyroid-stimulating immunoglobulins and in cell-mediated immunoreactivity to TSH receptor (TSH-R) and it peptide epitopes. During this phase, ophthalmopathy often is exacerbated. Although it is logical to believe that the release of antigens and stimulation of immunoreactivity is the cause of the worsened ophthalmopathy, a direct cause and effect only can be inferred. Ophthalmopathy often remains a significant problem or develops during the course of treatment of Graves' disease. My observations are that almost all patients who have progressive ophthalmopathy after many form of thyroid treatment usually have residual thyroid tissue stimulated by thyroid stimulating antibodies, even though they may be hypothyroid and on replacement therapy. In this situation, destruction of residual thyroid tissue is associated with amelioration in ophthalmopathy and is presumed to be effective because of diminution in antigenic stimulation, with a subsequent drop in antibody levels and cell-mediated immunoreactivity to TSH-R extracellular domain (ECD). This constitutes a second phase in the radioiodine response, with effects dramatically different from the initial phase, because this phase is associated with a loss in antigenic stimulation rather than an increase. In a series now comprising > 40 patients treated in an uncontrolled prospective manner, comparison to preablation and postablation ophthalmopathy demonstrates clear benefit in almost all patients over a period of 3-12 months. Radioiodine ablation of residual thyroid tissue is the logical first treatment in management of severe ophthalmopathy and should be used before or with the institution of steroids or radiotherapy.