To elucidate the role of cytokine receptor signal transduction in T-cell development, we have investigated the expression pattern and biochemical characteristics of the murine Janus family tyrosine kinase, JAK3. Previous studies have shown that JAK3 is expressed in lymphoid and myeloid tumor cell lines and in a small number of lymphoid tissues. To further characterize JAK3 expression, we used a quantitative polymerase chain reaction approach to compare JAK3 mRNA levels at multiple stages of T-cell differentiation and in a broad range of mouse tissues. These studies, in conjunction with analyses of JAK3 protein expression, show that the highest levels of JAK3 are in adult, 2-week-old, and fetal thymus, followed by somewhat lower levels in bone marrow, spleen, fetal liver, and adult CD4-CD8- thymocytes. We also show that different forms of JAK3 mRNA arise by alternative splicing. Finally, our biochemical studies show that the JAK3 kinase domain, but not the pseudo-kinase domain, has tyrosine kinase activity and, furthermore, that JAK3 kinase activity is abolished by an amino acid substitution of the conserved lysine in the kinase domain (K851R). These studies show that JAK3 expression is profoundly skewed to hematopoietic and lymphoid precursor cells, strongly suggesting a role for JAK3 in hematopoiesis and T- and B-cell development.