Rat retinal glial cells (Müller cells) profoundly suppress antigen-driven activation, as well as the subsequent interleukin-2 (IL-2)-dependent expansion of autoimmune and conventional-immune syngeneic T-helper lymphocytes, through a contact-dependent mechanism. Characterization of this inhibitory function showed that some activation parameters of autoimmune T-helper lymphocytes specific to the retinal soluble antigen, responding to antigen presented on syngeneic antigen-presenting cells, were differentially affected by coculture with Müller cells. In contrast to endogenous IL-2 production, IL-2-receptor generation and proliferation, the production of interleukin-3 and of interferon-gamma were not inhibited. Inhibition of IL-2-supported proliferation of cells which had already generated the IL-2 receptor was markedly potentiated in the presence of the specific antigen, in a dose-dependent manner. The extent of inhibition was proportional to the number of Müller cells in the culture. The suppression appeared not to involve a major histocompatibility complex (MHC) Class II-related interaction and could act across allogeneic and even xenogeneic barriers. Inhibition affected normal lymphocytes, including primed T cells responding to antigen or to IL-2, unprimed spleen cells responding to the T-cell mitogen concanavalin A (Con-A) and, to a lesser extent, unprimed spleen cells responding to the B-cell mitogen bacterial lipopolysaccharide (LPS). Several permanently transformed cell lines of mouse, rat and human origin were not affected. These results may suggest participation of organ-resident cells in regulation of locally occurring immune processes.