During variable/diversity/joining (V[D]J) recombination, the enzyme terminal deoxynucleotidyl transferase (Tdt) adds random nucleotides at the junctions of the rearranging gene segments, increasing diversity of the antibody (Ab) and T cell receptor repertoires. Two splice variants of Tdt have been described, but only one (short isoform of Tdt [TdtS]) has been convincingly demonstrated to catalyze nontemplated (N) addition in vitro. We have expressed each splice variant of Tdt in transgenic (Tg) mice and found that the TdtS transgene catalyzes N addition on the endogenous Tdt-/- background and in fetal liver, but that the long isoform of Tdt (TdtL) transgene does neither. In contrast to previous in vitro results, both TdtS and TdtL are translocated to the nucleus in our model. Furthermore, TdtL/TdtS double Tg mice exhibit less N addition in fetal liver than do TdtS Tg mice. Whereas the TdtS transgene was shown to have functional consequences on the antiphosphorylcholine (PC) B cell repertoire, TdtL Tg mice exhibit a normal PC response, and Tdt-/- mice actually exhibit an increase in the PC response and in TEPC 15 idiotype+ Ab production. We conclude that TdtL localizes to the nucleus in vivo where it serves to modulate TdtS function.