A key step in T cell development involves the positive selection of cells that recognize antigen presented by self-major histocompatibility complex. Yet, the signals that are activated by T cell receptor engagement and lead to cell survival remain unclear. We show here that mice lacking the transcription factor Schnurri-2 (Shn-2), a large metal-finger protein, had severely defective positive selection of CD4(+) and CD8(+) cells. Drosophila Shn acts as a cofactor of Smad homolog and is required for Decapentaplegic signaling. Vertebrates have at least three Shn orthologs (Shn-1, Shn-2 and Shn-3), which are thought to act as nuclear targets in the bone morphogenetic protein-transforming growth factor-beta -activin signaling pathways. These data raised the possibility that the Smad-Shn-2 complex is involved in the thymic selection of T cells.