CD28-B7 interaction plays a critical costimulatory role in inducing T cell activation, while CTLA-4-B7 interaction provides a negative signal that is essential in immune homeostasis. Transfer of CD45RB high CD4+ T cells from syngeneic mice induces transmural colon inflammation in SCID recipients. This adoptive transfer model was used to investigate the contribution of B7-CD28/CTLA-4 interactions to the control of intestinal inflammation. CD45RB high CD4+ cells from CD28−/− mice failed to induce mucosal inflammation in SCID recipients. Administration of anti-B7. 1 (but not anti-B7. 2) after transfer of wild-type CD45RB high CD4+ cells also prevented wasting disease with colitis, abrogated leukocyte infiltration, and reduced production of proinflammatory cytokines IL-2 and IFN-γ by lamina propria CD4+ cells. In contrast, anti-CTLA-4 treatment led to deterioration of disease, to more severe inflammation, and to enhanced production of proinflammatory cytokines. Of note, CD25+ CD4+ cells from CD28−/− mice similar to those from the wild-type mice were efficient to prevent intestinal mucosal inflammation induced by the wild-type CD45RB high cells. The inhibitory functions of these regulatory T cells were effectively blocked by anti-CTLA-4. These data show that the B7-CD28 costimulatory pathway is required for induction of effector T cells and for intestinal mucosal inflammation, while the regulatory T cells function in a CD28-independent way. CTLA-4 signaling plays a key role in maintaining mucosal lymphocyte tolerance, most likely by activating the regulatory T cells.