A PAX8-PPARgamma rearrangement has been recently identified in follicular thyroid carcinomas, but not in follicular adenomas or other thyroid tumors. We report here the analyses of PAX8-PPARgamma in a series of 118 thyroid tumors using a newly developed RT-PCR assay to detect this rearrangement in frozen and paraffin-embedded tissues and using immunostaining with a PPARgamma antibody. PAX8-PPARgamma was detected by RT-PCR in eight of 15 (53%) follicular carcinomas and two of 25 (8%) follicular adenomas but not in 35 papillary carcinomas (including 12 follicular variants), 12 Hurthle cell carcinomas, 12 Hurthle cell adenomas, two anaplastic carcinomas, one poorly differentiated carcinoma, or 16 hyperplastic nodules. The prevalence was higher in follicular carcinomas from patients with a history of radiation exposure (three of three). Strong, diffuse nuclear immunostaining with the PPARgamma antibody correlated with the presence of PAX8-PPARgamma detected by RT-PCR. Most sporadic follicular carcinomas positive for PAX8-PPARgamma were overtly invasive, whereas tumors lacking the rearrangement were predominantly minimally invasive. The two follicular adenomas positive for PAX8-PPARgamma had trabecular growth pattern and thick capsule, but no invasion, and thus may represent "pre-invasive" follicular carcinomas. The absence of PAX8-PPARgamma rearrangements in Hurthle cell tumors and papillary thyroid carcinomas highlights the differences in the molecular pathogenesis of these thyroid tumors.