Murine small intestine intraepithelial lymphocytes (IELs) bear properties of both activated and nonactivated T cells, although the significance of that dichotomy remains unclear. In this study, we show that although IELs express CD69 in situ and ex vivo, and have cytotoxic activity ex vivo, most CD8(+) IELs from normal mice are phenotypically similar to naive T cells in that they are CD45RB(high), CD44(low/int), and lack or have low levels of expression of CD25, Ly-6C, OX40, Fas ligand (FasL), and intracellular IFN-gamma synthesis. Unlike CD8(+) lymph node cells, IELs express high levels of the FasL gene, but do not express surface FasL until after CD3-mediated stimulation has occurred. Additionally, anti-CD3 stimulation of IELs in the presence of actinomycin-D did not inhibit FasL expression, suggesting that regulation FasL expression on IELs is controlled at least partially at the posttranscriptional level. Following CD3-mediated stimulation, IELs synthesize and secrete IFN-gamma more rapidly and to greater levels than CD8(+) lymph node cells, and they acquire the phenotype of fully activated effector cells as seen by an up-regulation of CD44, Ly-6C, OX40, FasL, and CD25 with the kinetics of memory T cells, with down-regulation of CD45RB expression. These findings indicate that contrary to previous interpretations, most small intestine IELs are not fully activated T cells, but rather that they are semiactivated T cells ready to shift to a fully activated state once a CD3-mediated signal has been received. These data also imply that under appropriate conditions it is possible for T cells to be sustained in a state of partial activation.