To investigate the consequences of CD40 engagement on the neonatal induction of transplantation tolerance, BALB/c mice were injected at birth with (A/J x BALB/c) F1 spleen cells together with activating anti-CD40 mAb and grafted 4 wk later with A/J skin. Whereas A/J allografts were accepted in mice neonatally injected with F1 cells and control Ab, they were acutely rejected in mice injected with F1 cells and anti-CD40 mAb. Neonatal administration of anti-CD40 mAb resulted in enhanced anti-A/J CTL activity, increased IFN-gamma, and decreased IL-4 production by donor-specific T cells in vitro. Experiments using anti-cytokine mAb and IFN-gamma-deficient mice demonstrated that CD40 ligation prevents neonatal allotolerance through an IFN-gamma- and IL-12-dependent pathway. Finally, we found that newborn T cells express less CD40L than adult T cells upon TCR engagement. Taken together these data indicate that insufficiency of CD40/CD40L interactions contribute to neonatal transplantation tolerance.