Autoantibodies to the thyrotrophin (TSH) receptor (anti-TSHR) are unique, in that they are involved directly in the pathophysiology of certain autoimmune thyroid diseases (AITD). Thyroid-stimulating antibodies (TSAb) act as agonists that activate the thyroid gland and cause Graves' disease. Other anti-TSHR antibodies block TSH and can cause hypothyroidism. Thyroid-blocking antibodies (TBAb) have not been studied as extensively as TSAb. We developed a TBAb bioassay based on a cell line that expresses a chimeric TSHR. The 50% inhibitory concentration of the chimeric Chinese hamster ovary (CHO)-Luc cells was more than five-fold lower compared with the wild-type CHO-Luc cells. We tested the performance of this bioassay using a thyroid-blocking monoclonal antibody K1-70, established an assay cut-off and detected TBAb in 15 of 50 (30%) patients with AITD. Interestingly, the assay detects both TSAb and TBAb and measures the net activity of a mixture of both types of antibodies. There was a high correlation (R2 0·9, P < 0·0001) between the results of the TSAb assay and the negative percentage inhibition of the TBAb assay. The TBAb bioassay was approximately 20-fold more sensitive than a commercially available TSHR binding assay (TRAb). In contrast to TRAb, sera with high levels of TBAb activity were able to be diluted several hundred-fold and still exhibit blocking activity above the cut-off level. Thus, this TBAb bioassay provides a useful tool for measuring the activity of anti-TSHR antibodies and may help clinicians to characterize the diverse clinical presentations of patients with AITD.