The immune system develops in a series of programmed developmental stages. Although recombination-activating gene (RAG) and nonhomologous end-joining (NHEJ) proteins are indispensable in the generation of immunoglobulins and T-cell receptors (TCRs), most CDR3 diversity is contributed by nontemplated addition of nucleotides catalyzed by the nuclear enzyme terminal deoxynucleotidyltransferase (TdT) and most nucleotide deletion is performed by exonucleases at V(D)J joins. Increasing TdT expression continuing into adult life results in N region addition and diversification of the T and B cell repertoires. In several species including mice and humans, there are multiple isoforms of TdT resulting from alternative mRNA splicing. The short form (TdTS) produces N additions during TCR and B-cell receptor (BCR) gene rearrangements. Other long isoforms, TdTL1 and TdTL2, have 3' --> 5' exonuclease activity. The two forms of TdT therefore have distinct and opposite functions in lymphocyte development. The enzymatic activities of the splice variants of TdT play an essential role in the diversification of lymphocyte repertoires by modifying the composition and length of the gene segments involved in the production of antibodies and T-cell receptors.