To investigate the regulatory effects of decoy receptor 3 (DcR3) on the differentiation and function of dendritic cells (DCs), bone marrow-derived DCs (BM-DCs) from nonobese diabetic (NOD) mice were cultured with recombinant DcR3.Fc protein. Their differentiating phenotypes and T cell-stimulating functions were then evaluated. Expression of CD11c, CD40, CD54, and major histocompatibility complex I-A(g7) was reduced in cells cultured with additional DcR3.Fc, compared with DCs incubated with granulocyte macrophage-colony stimulating factor and interleukin (IL)-4, indicating that DcR3 interferes with the differentiation and maturation of BM-DCs. One of the most striking effects of DcR3.Fc on the differentiation of DCs was the up-regulation of CD86 and down-regulation of CD80, suggesting a modulatory potential to skew the T cell response toward the T helper cell type 2 (Th2) phenotype. Consistent with this, the proliferation of CD4(+) T cells cocultured with DcR3.Fc-treated DCs was significantly reduced compared with that of T cells stimulated by normal DCs. Moreover, the secretion of interferon-gamma from T cells cocultured with DcR3.Fc-treated DCs was profoundly suppressed, indicating that DcR3 exerts a Th1-suppressing effect on differentiating DCs. Furthermore, adoptive transfer experiments revealed that NOD/severe combined immunodeficiency mice received DcR3.Fc-treated DCs, and subsequently, autoreactive T cells showed delayed onset of diabetes and a decrease in diabetic severity compared with mice that received normal DCs and T cells, suggesting a future therapeutic potential in autoimmune diabetes. Data from two-dimensional gel electrophoresis and matrix-assisted laser desorption/ionization-time-of-flight analysis show an up-regulation of some proteins-such as mitogen-activated protein kinase p38 beta, cyclin-dependent kinase 6, and signal-induced proliferation-associated gene 1-and a down-regulation of the IL-17 precursor; tumor necrosis factor-related apoptosis-inducing ligand family member-associated nuclear factor-kappaB activator-binding kinase 1; and Golgi S-nitroso-N-acetylpenicillamine in cells treated with DcR3, further demonstrating its effect on DC differentiation and function.