Hepatocyte growth factor (HGF) plays an important role in angiogenesis, cell proliferation, antifibrosis, and antiapoptosis. Moreover, recent studies have highlighted the immunosuppressive effect of HGF in animal models of allogenic heart transplantation and autoimmune myocarditis and in studies in vitro as well. We also reported that HGF significantly suppresses dendritic cell function, thus down-regulating Ag-induced Th1-type and Th2-type immune responses in allergic airway inflammation. However, the immunosuppressive effect of HGF in many other situations has not been fully clarified. In the present study, using a mouse model of collagen-induced arthritis (CIA) and experiments in vitro, we examined the effect of HGF on autoimmune arthritis and then elucidated the mechanisms of action of HGF. To achieve sufficient delivery of HGF, we used biodegradable gelatin hydrogels as a carrier. HGF suppressed Ag-induced T cell priming by regulating the functions of dendritic cells in the Ag-sensitization phase with down-regulation of IL-10. In contrast, under continuous Ag stimulation HGF induced IL-10-producing immunocytes both in vivo and in vitro. Moreover, HGF potently inhibited the development of CIA with enhancing the Th2-type immune response. We also confirmed that HGF significantly suppressed the production of IL-17 by immunocytes. These results indicate that HGF suppresses the development of CIA through different ways at different phases. They also suggest that HGF could be an attractive tool for treating patients with rheumatoid arthritis.