This lecture discusses two interrelated topics, B cell tolerance in the peripheral immune system and BAFF. Using the 3-83 antibody transgenic mouse bred to mice carrying cognate antigen in the liver, we previously found that clonal elimination drastically reduced the precursor frequency of autoreactive cells. The consensus model to explain this tolerance is the 2-signal hypothesis, which proposes that in the absence of T cell help BCR stimulation is a negative signal for B cells. However, this model fails to explain how these same B cells can respond to T-independent type II (TI-2) antigens, raising the question of how they distinguish TI-2 antigens from multimeric self determinants. We propose that B cells use NK-like missing self recognition to provide the needed specificity, as foreign antigens are unlikely to carry self markers. The model has implications for the evolution of the immune system, B lymphocyte signaling, tissue specificity of autoimmunity, and microbial subversion of the immune system. Overexpression of the critical B cell survival cytokine BAFF/BLyS has been associated with autoimmunity. We have discovered a novel splice isoform that regulates BAFF activity and may play a role in limiting B cell activity. The novel form, called DBAFF, is able to heteromultimerize with normal BAFF and can suppress receptor binding and proteolytic release from the cell surface. Preliminary studies from transgenic mice overexpressing wild type or DBAFF are consistent with a possible regulatory role for DBAFF, raising the possibility that the relative expression levels of BAFF and DBAFF regulates tolerance.