Graves' ophthalmopathy (GO) is a common manifestation of Graves' disease (GD); however, its pathogenesis is not well understood. Recently, the dysregulation of regulatory T cells (Tregs) has been thought to be closely associated with the pathogenesis and clinical symptoms of autoimmune disease. We therefore evaluated whether T cell subsets, including Tregs, are associated with GO pathogenesis and clinical symptoms. In this observational study we evaluated 35 GD patients with overt ophthalmopathy (GOs) and 28 patients without ophthalmopathy (non-GOs). Fifteen healthy euthyroid patients served as healthy controls (HCs). Peripheral blood mononuclear cells from GOs, non-GOs and HCs were analyzed for CD4, CD25, and FoxP3 expression using flow cytometry. We also evaluated their correlation with disease activity according to the clinical activity score (CAS) and magnetic resonance imaging (MRI) findings. Disease severity was evaluated using the NOSPECS score, and clinical progression of GO was followed for 24 weeks. The main outcome measures were the frequencies of FoxP3-positive and -negative CD4(+) CD25(+) T cells at study outset, namely Tregs and effector T cells (Teffs), respectively. GOs had higher frequencies of Teffs (30.8±8.4%) than non-GOs (19.4±7.1%) and HCs (22.7±7.9%). Notably, patients with improved GOs had lower frequencies of Tregs (5.8±1.1%) than patients with stable or deteriorated GOs (7.3±1.2%), although ophthalmic and radiological parameters were not significantly different at the start of the study. In conclusion, an expanded Teff population may be associated with GO pathogenesis. Additionally, decreased Tregs in peripheral blood may predict a good clinical outcome.