Transient neonatal hypothyroidism was found in a daughter of a 25-yr-old mother, who was receiving treatment for primary hypothyroidism due to Hashimoto's thyroiditis. During the neonatal period the infant had antithyroid microsomal and antithyroglobulin antibodies and TSH-receptor antibodies. The daughter recovered spontaneously from the hypothyroid state and the antithyroid antibodies disappeared from her serum. The mother's serum contained the same antibodies, and immunoglobulin G (IgG) from maternal serum blocked TSH binding to its receptors, TSH-stimulated cAMP responses, and cAMP-stimulated iodine uptake and organification in cultured thyroid cells. The latter finding suggests that the IgG had a postreceptor locus of action as well as inhibiting TSH binding to its receptor. The presence of such IgGs might have induced hypothyroidism both in the mother and in the daughter.