Natural CD4(+)CD25(+) regulatory T cells (nTreg) have been shown to control graft-versus-host disease after hematopoietic stem cell transplantation (HSCT). Herein, we considered the possibility that the beneficial action of nTreg upon immune reconstitution in lymphopenic hosts involves dampening of the inflammatory response induced by bacterial products. We first observed that transfer of syngeneic CD4(+)CD25(-) T cells in RAG-deficient mice dramatically enhanced release of inflammatory cytokines and associated pathology upon endotoxin injection. Interferon (IFN)-gamma produced by T cells undergoing homeostatic proliferation was shown to be involved in the endotoxin hyperresponsiveness induced by CD4(+) T cell reconstitution. Co-transfer of CD4(+)CD25(+) nTreg with CD4(+)CD25(-) T cells inhibited the expansion of IFN-gamma-producing T cells and reduced endotoxin responses in RAG(-/-) mice. We conclude that (1) CD4(+) T cell reconstitution sensitizes lymphopenic hosts to endotoxin-induced pathology and (2) nTreg prevent this process by limiting the emergence of IFN-gamma-producing cells.