Abstract: There is disclosed herein a toolholder for use in machine tools, particularly those of the type having means for automatically changing tools according to a predetermined plan, the toolholder being transported from a tool rack to a spindle for use and being returned to the tool rack when it has served its purpose. The toolholder has two flanges forming two annular grooves, one groove shaped to receive holding means on the tool rack and the other groove shaped to receive the edges of a socket in the tool transporting means; one flange having a single peripheral keyway to receive a key on the tool rack to maintain the circular orientation of the toolholder and tool therein when being stored on the rack and the other flange having two usually diametrically placed slots, one to engage a driving key on the spindle with which the tool is used, and the other to be engaged by a key on the carrier by which the tool and toolholder is transported to and from the spindle, said keys serving to maintain the desired 360.