The thyroid epithelium transports fluid bidirectionally using active transport of Na+ ions from apical to basal poles and active transport of Cl- in the reverse direction. In these studies we sought evidence for cyclic AMP activated Cl- channels on the apical membranes of thyroid cells in monolayer culture. A Cl--dependent basal-positive short-circuit current (I(SC)) was demonstrated in bicameral chambers after blocking Na+ transport with phenamil, and responded to prostaglandin (PG) E2 with a spike of 5-10 min duration followed by a plateau. The onset of the spike coincided with an increase in the conductance of the epithelium. Application of an external Cl- concentration gradient, by replacing the medium in the apical compartment with Cl--free medium, resulted in an increase in I(SC) after, but not before, addition of PGE2. Forskolin and thyroid-stimulating hormone (TSH), but not A23187, also stimulated Cl- transport. In conjunction with previous observations that Cl- transport was mediated by a bumetanide-sensitive NaKCl2 symporter on the basal membrane, these observations indicated the presence of a cyclic AMP activated Cl- conductance in the apical membrane of thyroid cells.