Since the discovery of the first nuclear factor of activated T cells (NFAT) protein more than a decade ago, the NFAT family of transcription factors has grown to include five members. It has also become clear that NFAT proteins have crucial roles in the development and function of the immune system. In T cells, NFAT proteins not only regulate activation but also are involved in the control of thymocyte development, T-cell differentiation and self-tolerance. The functional versatility of NFAT proteins can be explained by their complex mechanism of regulation and their ability to integrate calcium signalling with other signalling pathways. This Review focuses on the recent advances in our understanding of the regulation, mechanism of action and functions of NFAT proteins in T cells.