IL-2-deficient mice develop a lymphoproliferative and autoimmune disease characterized by autoimmune hemolytic anemia (AHA) and inflammatory bowel disease. We have previously reported that IL-2 is necessary for optimal up-regulation of CTLA-4, an inducible negative regulator of T cell activation. In this study, we have tested the hypothesis that reduced expression of CTLA-4 in IL-2-deficient T cells contributes to the pathogenesis of disease in IL-2-deficient mice. Expression of CTLA-4 as a transgene completely prevented lymphoaccumulation and AHA in IL-2-deficient mice. The normalization of T cell numbers was due to inhibition of expansion of conventional CD4+CD25- T cells rather than to rescue of the numbers or function of CD4+CD25+ regulatory T cells, suggesting that CTLA-4 expression on conventional T cells plays a role in maintaining normal T cell homeostasis. In addition, the inhibitory effect of the CTLA-4 transgene on T cell expansion was at least in part independent of CD28 expression. Our results suggest that deficient CTLA-4 expression on conventional T cells contributes to the pathophysiology of the lymphoproliferative disease and AHA in IL-2-deficient mice. Thus, restoring CTLA-4 expression in T cells may be an attractive strategy to control clinical autoimmune diseases in which CTLA-4 expression is reduced.