We have developed an adoptive transfer model system to visualize the dynamics of alloantigen-specific CD4+ T-cell activation in vivo. Using TCR-transgenic (tg) mice reactive to I-Ab(m12), we studied the clonal expansion and differentiation of alloreactive T cells by tracking the fate of adoptively transferred TCR-tg CD4+ T cells in syngeneic mice transplanted with skin grafts expressing I-Ab(m12). Following transplantation, alloantigen-specific TCR-tg CD4+ T-cell expansion was observed initially in the draining lymph nodes followed by the spleen. TCR-tg CD4+ T cells up-regulated CD69 and CD25 expression, developed an effector/memory surface phenotype and produced IFN-gamma in response to alloantigen ex vivo. Furthermore, we validate the model system as a means for studying the effects of tolerogenic regimens on alloreactive CD4+ T cells, demonstrating that CTLA4Ig inhibits alloantigen-dependent clonal expansion and effector function of TCR-tg CD4+ T cells in vivo. We describe the first model for tracking alloreactive CD4+ T-cell activation in vivo. It provides a powerful tool for studying CD4+ T-cell mediated alloimmune responses and mechanisms of tolerance induction in vivo.