Over the past ten years, investigators have shown that T lymphocytes can recognize not only peptides in the context of MHC class I and class II molecules but also foreign and self-lipids in association with the nonclassical MHC class I molecules the CD1 proteins. We describe the events that have led to the discovery of the role of CD1 molecules, their pattern of intracellular trafficking, and their ability to sample different intracellular compartments for self- and foreign lipids. Structural and functional aspects of lipid presentation by CD1 molecules are presented in the context of the function of CD1-restricted T cells in antimicrobial responses, antitumor immunity, and the regulation of the tolerance and autoimmunity immunoregulatory axis. Particular emphasis is on invariant NKT (iNKT) cells and their ability to modulate innate and adaptive immune responses.