Immune dysfunction is an important feature of multiple myeloma (MM) leading to infections, enhancement of tumour growth and resistance to chemotherapy. The overexpression of CD200, expansion of T regulatory (Treg) cell and increased levels of immune modulatory cytokines like IL10, IL6 and transforming growth factor beta (TGFβ) were suggested to have a role in this context. The aim of this study was to assess CD200 expression, Treg percentage by flow cytometry and immune modulatory cytokines (IL10, IL6, TGFβ) by enzyme‐linked immunosorbent assay in MM patients at diagnosis. This study included 50 MM patients at diagnosis and 20 healthy controls. The positive CD200 expression was detected in 72% of MM patients. Among the CD200 positive group, 4/13 patients (30.8%) were classified as stage I, 18/23 (78.3%) were in stage II and 14/14 (100%) were in stage III; according to International scoring system. Treg percentage was significantly higher in stage III, followed by stage II then stage I (p < 0.01). Serum IL6, IL10 and TGFβ were significantly higher in MM patients as compared with controls (p < 0.01, p < 0.01, p < 0.05, respectively). The increased expression of CD200 and Treg percentages was associated with increased severity biomarkers (serum LDH and β2 microglobulin). The degree of CD200 expression was significantly positively correlated to Treg percentage (r = 0.565, p < 0.01). Analysis of the CD200 negative patients had a better progression free survival (p = 0.032) and overall survival (p = 0.04) as compared with those positive for CD200 expression. These findings illustrate a clear correlation between myeloma cell CD200 expression level and the frequency of immunosuppressive Treg cells. In conclusion, increased expression of CD200, expansion of suppressive Treg cells and elevation of cytokines might have a role in MM progression in this cohort of patients. Copyright © 2015 John Wiley & Sons, Ltd.