Foxp3+ regulatory T (T R) cells are phenotypically and functionally diverse and broadly distributed in lymphoid and nonlymphoid tissues. However, the pathways guiding the differentiation of tissue-resident T R cell populations have not been well defined. By regulating E-protein function, Id3 controls the differentiation of CD8+ effector T cells and is essential for T R cell maintenance and function. We show that dynamic expression of Id3 helps define three distinct mouse T R cell populations: Id3+ CD62L hi CD44 lo central T R cells, Id3+ CD62L lo CD44 hi effector T R (eT R) cells, and Id3− eT R cells. Adoptive transfer experiments and transcriptome analyses support a stepwise model of differentiation from Id3+ central T R to Id3+ eT R to Id3− eT R cells. Furthermore, Id3− eT R cells have high expression of functional inhibitory markers and a transcriptional signature of tissue-resident T R cells. Accordingly, Id3− eT R cells are highly enriched in nonlymphoid organs but virtually absent from blood and lymph. Thus, we propose that tissue-resident T R cells develop in a multistep process associated with Id3 downregulation.