The thymic medulla represents a key site for the induction of T cell tolerance. In particular, autoimmune regulator (Aire)-expressing medullary thymic epithelial cells (mTECs) provide a spectrum of tissue-restricted Ags that, through both direct presentation and cross-presentation by dendritic cells, purge the developing T cell repertoire of autoimmune specificities. Despite this role, the mechanisms of Aire(+) mTEC development remain unclear, particularly those stages that occur post-Aire expression and represent mTEC terminal differentiation. In this study, in mouse thymus, we analyze late-stage mTEC development in relation to the timing and requirements for Aire and involucrin expression, the latter a marker of terminally differentiated epithelium including Hassall's corpuscles. We show that Aire expression and terminal differentiation within the mTEC lineage are temporally separable events that are controlled by distinct mechanisms. We find that whereas mature thymocytes are not essential for Aire(+) mTEC development, use of an inducible ZAP70 transgenic mouse line--in which positive selection can be temporally controlled--demonstrates that the emergence of involucrin(+) mTECs critically depends upon the presence of mature single positive thymocytes. Finally, although initial formation of Aire(+) mTECs depends upon RANK signaling, continued mTEC development to the involucrin(+) stage maps to activation of the LTα-LTβR axis by mature thymocytes. Collectively, our results reveal further complexity in the mechanisms regulating thymus medulla development and highlight the role of distinct TNFRs in initial and terminal differentiation stages in mTECs.