The T cell repertoire is shaped by the processes of positive and negative selection. During development, the TCR binds self peptide-MHC complexes in the thymus, and the kinetics of this interaction are thought to determine the thymocyte's fate. For development of CD8+ T cells, the data supporting such a model have been obtained using fetal thymic organ culture. To confirm the fidelity of this model in vivo, we studied development of OT-I TCR-transgenic mice that expressed different individual Kb binding peptides in thymic epithelial cells under the control of the human keratin 14 promoter. We used a system that allowed TAP-independent expression of the peptide-MHC complex, such that the ability of given peptides to restore positive selection in TAPo mice could be assessed. We found that transgenic expression of a TCR antagonist peptide (E1) in vivo efficiently restored positive selection of OT-I T cells in TAPo mice. An unrelated transgenic peptide (SIY) did not restore selection of OT-I T cells, nor did the E1-transgenic peptide restore selection of an unrelated receptor (2C), showing that positive selection is peptide specific in vivo, as observed in organ cultures. Neither E1 nor SIY transgenes increased the polyclonal CD8 T cell repertoire size in non-TCR-transgenic animals, arguing that single class I binding peptides do not detectably affect the size of the CD8 T cell repertoire when expressed at low levels. We also observed that OT-I T cells selected in TAPo-E1 mice were functional in their response to Ag; however, there was a lag in this response, suggesting that the affinity of the TCR interaction with MHC-self peptide can result in fine-tuning of the T cell response.