Antithymocyte/antilymphocyte globulins are polyclonal antihuman T-cell antibodies used clinically to treat acute transplant rejection. These reagents deplete T cells, but a rabbit antihuman thymocyte globulin has also been shown to induce regulatory T cells in vitro. To examine whether antithymocyte globulin-induced regulatory cells might be functional in vivo, we generated a corresponding rabbit antimurine thymocyte globulin (mATG) and tested its ability to induce regulatory cells in vitro and whether those cells can inhibit acute graft-versus-host disease (GVHD) in vivo upon adoptive transfer. In vitro, mATG induces a population of CD4(+)CD25(+) T cells that express several cell surface molecules representative of regulatory T cells. These cells do not express Foxp3 at either the protein or mRNA level, but do show suppressive function both in vitro and in vivo when adoptively transferred into a model of GVHD. These results demonstrate that in a murine system, antithymocyte globulin induces cells with suppressive activity that also function in vivo to protect against acute GVHD. Thus, in both murine and human systems, antithymocyte globulins not only deplete T cells, but also appear to generate regulatory cells. The in vitro generation of regulatory cells by anti-thymocyte globulins could provide ad-ditional therapeutic modalities for immune-mediated disease.