By an alkaline alcoholic hydrolysis, the thyroid proteins are broken into many simpler constituents. These may be separated into two groups: the acid insoluble compounds are designated Group A; those acid soluble, Group B. From Group A a pure crystalline compound, containing 60 per cent of iodin, has been isolated. It appears to be di-iodo-di-hydroxy-indol. Group B contains iodin in some unknown form of combination. It is a mixture containing amino-acid complexes and a low molecular weight. Administration of A produces in the dog and in the human being a rapid increase in pulse rate and vigor, and increase in metabolism and nervous irritability. This physiologic activity is produced by the compound containing iodin in all stages of purity up to and including its crystalline form. Given in excess, toxic symptoms are produced. The amount of the iodin compound required to produce toxic effects is exceedingly small. In exophthalmic goiter two abnormal conditions exist. First, the secreting capacity of the gland is greatly increased and, second, the reservoir capacity of the gland is greatly decreased. The iodin compound plays an important role in the production of the symptoms of exophthalmic goiter. The constituents of Group B produce no toxic symptoms, but in cases of cretinism, myxedema and certain skin conditions, they exert physiologic activity.