Recognition of a systemic antigen by CD4+ T cells in a lymphopenic host leads to the sequential generation of pathogenic effector cells and protective CD25+ forkhead box protein (Foxp3+) regulatory T cells (Tregs) in the periphery. Such an experimental model is potentially valuable for defining the stimuli that determine the balance of effector and regulatory T cells. Our studies have shown that interleukin-2 (IL-2) enhances the development of effector cells and is essential for the peripheral generation of regulatory cells. Other models of peripheral Treg generation suggest that the concentration of antigen, the nature of the antigen-presenting cells, and cytokines such as transforming growth factor-beta and IL-10 may all influence the peripheral generation of Tregs.