I have a 123, but I'm fairly sure there should be a gasket. They come with the thermostats but there are 2 kinds. One goes around the outside of the thermostat, and the other fits on one of the inner surfaces. You need either one or the other.

Blue Stuff, if it is silicone, is real bad for the cooling system according to some posters here. I'm a newbie, but I just did my first coolant flush. When I got my thermostat they gave me the wrong gasket the first time.

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Mr Goodfahrt (pronounced FAIRT... means "good trip" in German)

1982 300D Turbo Pastel Gray (off-white) 200k+(?)
newbie but willing