1. When 2-methylthiobenzothiazole and 35S-labelled glutathione (GSH) were incubated with rat liver homogenates, both 35S-labelled S-(2-benzothiazolyl)-glutathione and 2-mercaptobenzothiazole were isolated from the reaction mixtures. Glutathione-S-transferase appears to be involved in the S-(2-benzothiazolyl)glutathione (GBZ) formation. 2. The evidence indicates that 2-methylthiobenzothiazole is oxidized to its corresponding methylsulphoxide and/or methylsulphone which becomes a substrate for GSH conjugation. 3. Degradation products identified from the methylthio group were formaldehyde and sulphate. 4. Although sulphur is exchanged in this pathway, the net result of this pathway which involves oxidation of the methylthio group and GSH conjugation is an apparent S-demethylation of the methylthio group. 5. Another S-demethylation pathway which does not involve GSH conjugation also functioned in vitro.