Targeted therapy pinpointing specific alteration in cancer cells has gained an important role in the treatment of cancer. Compounds that re-induce thyroid-specific functions could be particularly useful in differentiated thyroid cancers by rendering them susceptible to radioiodine treatment, which is relatively specific and has few adverse effects. This review describes the rationale for radioiodine treatment, considering the targets of compounds with differentiation-inducing effects, and the impact of these drugs on the expression of thyroid-specific proteins and on iodine-uptake. We survey the results from the clinical trials thus far performed. We conclude that although retinoids, thiazolidinediones, histone deacetylase inhibitors and DNA methyltransferase inhibitors do increase the expression of thyroid-specific proteins, their clinical efficacy is limited. The relatively low rate of remissions in clinical trials with re-differentiating compounds could be due to low levels of the target, heterogeneity of iodine uptake into the tumor, poor correlation of radioiodine uptake and clinical remission, and/or the slow onset of the therapeutic effect. Although the mode of action is not clear, the combination of tyrosine kinase inhibitors and RAI treatment could improve clinical responses in non-radioiodine avid metastatic thyroid carcinoma.