A widely held model of thymic epithelial differentiation is based on patterns of keratin expression, where a K8+ K5+ progenitor gives rise to K8+ K5/K14− cortical thymic epithelium (CTEC), and medullary thymic epithelium (MTEC) are K8− K5+ K14+. The thymic phenotype of p63-deficient mice indicates that p63 is an important regulator of proximal stages of thymic epithelial differentiation. In this study, we have examined several features of the thymic medullary compartment in wild-type and Aire-deficient thymi in an effort to integrate the proapoptotic activity of Aire with these different perspectives of TE differentiation. Patterns of keratin and p63 expression by MTEC described here are difficult to reconcile with postmitotic MTEC that express a K8− K14+ phenotype and suggest that the patterns of p63 and keratin expression reflecting differentiation programs of other epithelial tissues provide a useful framework for revising models of TE differentiation. Alterations of the Aire−/− MTEC compartment included reduced expression of p63, increased frequency of MTEC expressing truncated Aire protein, and shifts in the pattern of keratin expression and epithelial morphology. These data suggest a scenario where cellular targets of Aire-mediated apoptosis are postmitotic MTEC that have not yet completed their terminal differentiation program. According to this view, the minor population of globular K8+ K14−/low MTEC observed in the Aire+/+ thymus and significantly expanded in the Aire−/− thymic medulla represent end-stage, terminally differentiated MTEC. These Aire-dependent alterations of the MTEC compartment suggest that the activity of Aire is not neutral with respect to the program of MTEC differentiation.