Mice deficient in interleukin (IL)-2 production or the IL-2 receptor α or β chains develop a lethal autoimmune syndrome. CD4⁺ regulatory T cells have been shown to prevent autoimmune diseases, allograft rejection, and to down-regulate antibody responses against foreign antigens. To assess the role of IL-2 in the generation and function of regulatory T cells, we transferred CD4⁺ T cells from mice genetically deficient in IL-2 or IL-2Rα (CD25) expression. A small number of splenic or thymic CD4⁺ T cells from IL-2 knockout mice can protect mice from spontaneous experimental autoimmune encephalomyelitis (EAE). In contrast, splenic or thymic CD4⁺ T cells from CD25 knockout donor mice conferred little or no protection. We conclude that T cells with regulatory potential can develop, undergo thymic selection, and migrate to the peripheral lymphoid organs in the absence of IL-2, and do not protect from disease by means of IL-2 secretion. However, IL-2 signaling in regulatory T cells is essential for their protective function. Altogether, our results favor a model whereby IL-2 induces regulatory T cell activity.