Nuclear hormone receptors (NRs) form a family of transcription factors that mediate cellular responses initiated by hormone binding. It is generally recognized that the structure and dynamics of the C-terminal helix 12 (H12) of NRs' ligand binding domain (LBD) are fundamental to the recognition of coactivators and corepressors that modulate receptor function. Here we study the role of three mutations in the I280 residue of H12 of thyroid hormone receptors using site-directed mutagenesis, functional assays, and molecular dynamics simulations. Although residues at position 280 do not interact with coactivators or with the ligand, we show that its mutations can selectively block coactivator and corepressor binding, and affect hormone binding affinity differently. Molecular dynamics simulations suggest that ligand affinity is reduced by indirectly displacing the ligand in the binding pocket, facilitating water penetration and ligand destabilization. Mutations I280R and I280K link H12 to the LBD by forming salt bridges with E457 in H12, stabilizing H12 in a conformation that blocks both corepressor and coactivator recruitment. The I280M mutation, in turn, blocks corepressor binding, but appears to enhance coactivator affinity, suggesting stabilization of H12 in agonist conformation.