Tgf-beta1-/- mice develop a progressive, lethal, inflammatory syndrome, but mechanisms leading to the spontaneous activation of Tgf-beta1-/- T cells remain unclear. Here we show the disruption of CD28 gene expression accelerates disease in Tgf-beta1-/- mice, and we link this increase in severity to a reduction in the number of CD4+CD25+ regulatory T cells. CD4+CD25+ T cells develop normally in Tgf-beta1-/- mice and display characteristic expression of cytotoxic T lymphocyte-associated antigen 4 (CTLA-4), glucocorticoid-induced tumor necrosis factor receptor (GITR), alpha(E)beta7 integrin, and Foxp3. Adoptive transfer of Tgf-beta1-/- splenocytes to Tgf-beta1+/+/Rag2-/- mice induced an autoimmune inflammatory disease with features similar to those of the Tgf-beta1-/- phenotype, and disease transfer was accelerated by the depletion of Tgf-beta1-/- CD4+CD25+ T cells from donor splenocytes. Cotransfer of Tgf- beta1-/- CD4+CD25+ T cells clearly attenuated disease in Rag2-/- recipients of CD25+-depleted Tgf-beta1-/- spleen and lymph node cells, but suppression was incomplete when compared with Tgf-beta1+/+ CD4+CD25+ T cells. These data demonstrate that CD4+CD25+ regulatory T cells develop in complete absence of endogenous transforming growth factor-beta1 (TGF-beta1) expression and that autocrine TGF-beta1 expression is not essential for these cells to suppress inflammation in vivo.