Differentiation of alpha beta T cell receptor (TCR)-expressing T cells involves an obligatory interaction with self-major histocompatibility complex (MHC) molecules in the thymus. This process, called positive selection, both rescues thymocytes from programmed cell death and induces their differentiation into mature T cells. Another critical event in thymic development is to prevent maturation of hazardous autoreactive T cells; thus, mechanisms exist to eliminate T cells with self-reactive receptors (negative selection). How can these two pathways be distinguished? This question, which has long taxed immunologists, is more opposite because many features of the interactions in positive and negative selection are shared: Both processes are exquisitely MHC-allele specific, they involve MHC-bound peptide recognition, and employ at least some overlapping signal transduction pathways. However, resolution of this paradox has become much more feasible with the advent of powerful systems for withdrawing and reconstituting individual components involved in positive selection. This review describes recent advances in our understanding of the cells, receptors, ligands, and signaling pathways involved in this process. A pivotal part of this puzzle is the basis for discrimination between TCR ligands that induce positive vs negative selection. Recent work suggests that the peptide/MHC ligand for positive selection may bind with low avidity to the TCR. The implications of these data for the nature of T cell recognition during positive selection are discussed below.