Tolerance in vivo is maintained by multiple mechanisms that function to prevent autoimmunity. An encounter of CD4+ T cells with a circulating self-Ag leads to partial thymic deletion, the development of CD25+ regulatory T cells (Tregs), and functional anergy in the surviving CD25- population. We have compared anergic and regulatory T cells of the same Ag specificity generated in vivo by the systemic self-Ag. Anergic cells are unresponsive to the self-Ag that induces tolerance, but upon transfer into a new host and immunization, anergic cells can induce a pathologic autoimmune reaction against tissue expressing the same Ag. Tregs, in contrast, are incapable of mediating harmful reactions. To define the basis of this functional difference, we have compared gene expression profiles of anergic and regulatory T cells. These analyses show that Tregs express a distinct molecular signature, but anergic cells largely lack such a profile. Anergic cells express transcripts that are associated with effector differentiation, e.g., the effector cytokines IL-4 and IFN-gamma. Anergic cells do not produce these cytokines in response to self-Ag, because the cells exhibit a proximal signaling block in response to TCR engagement. Thus, anergy reflects an aborted activation pathway that can readily be reversed, resulting in pathologic effector cell responses, whereas Treg development follows a distinct developmental pathway that extinguishes effector functions.