An important question in memory development is understanding the differences between effector CD8 T cells that die versus effector cells that survive and give rise to memory cells. In this study, we provide a comprehensive phenotypic, functional, and genomic profiling of terminal effectors and memory precursors. Using killer cell lectin-like receptor G1 as a marker to distinguish these effector subsets, we found that despite their diverse cell fates, both subsets possessed remarkably similar gene expression profiles and functioned as equally potent killer cells. However, only the memory precursors were capable of making interleukin (IL) 2, thus defining a novel effector cell that was cytotoxic, expressed granzyme B, and produced inflammatory cytokines in addition to IL-2. This effector population then differentiated into long-lived protective memory T cells capable of self-renewal and rapid recall responses. Experiments to understand the signals that regulate the generation of terminal effectors versus memory precursors showed that cells that continued to receive antigenic stimulation during the later stages of infection were more likely to become terminal effectors. Importantly, curtailing antigenic stimulation toward the tail end of the acute infection enhanced the generation of memory cells. These studies support the decreasing potential model of memory differentiation and show that the duration of antigenic stimulation is a critical regulator of memory formation.