C-cell complexes are special cell groups consisting of a mass of C-cells associated with other epithelial elements and cysts. They are remnants of ultimobranchial bodies retaining fetal characteristics. In the C-cell complexes there are follicular cells in various stages of differentiation, i.e., the cell clusters not yet organized into follicles, primordial follicles with small lumens and comparatively enlarged follicles storing plentiful amounts of colloid. They have a morphology similar to follicular cells of fetal thyroid glands and react to antiserum to 19S thyroglobulin. In order to determine whether or not the follicles in these complexes have the ability to incorporate radioiodine, autoradiography after a single injection of 125I was combined with immunoperoxidase staining using specific anti-calcitonin, anti-C-thyroglobulin, and anti-19S thyroglobulin antisera. The 19S-positive cells not yet organized into follicles did not take up radioiodine. Primordial follicles showed a heavy accumulation of silver grains over their follicular lumens storing new 19S thyroglobulin as colloid. Comparatively enlarged follicles revealed a strong autoradiographic reaction and their labeling patterns were identical with those of typical thyroid follicles. These results confirm that the follicles in C-cell complexes, as well as thyroid follicles, can incorporate radioiodine and are related to thyroid hormone synthesis. That is, functional thyroid follicles can arise from the ultimobranchial bodies.