T lymphocytes are key inflammatory cells contributing significantly to the pathogenesis of Rheumatoid arthritis (RA). Biological treatments targeting T lymphocytes may provide an efficient approach for treatment of RA. CTLA4-FasL, a fusion product of extracellular domains of CTLA4 and FasL, integrating two inhibitory elements against T cells into one molecule, might be a desirable derivative of engineered soluble FasL or CTLA4 and have therapeutic potential in RA. The aim of this study was to investigate whether simultaneous induction of Fas-mediated apoptosis and blockade of co-stimulation signal by CTLA4-FasL gene delivery has a suppressive effect on adjuvant-induced arthritis (AIA) in Lewis rats. Recombinant adeno-associated virus (rAAV) vectors encoding rat CTLA4-FasL fusion gene (rAAV.CTLA4-FasL) or enhanced green fluorescent protein (rAAV.EGFP) were injected intraarticularly into both ankle joints after immunization. The ankles were monitored by measures of clinical, histological and inflammatory cytokines' changes. Treatment using rAAV.CTLA4-FasL resulted in a significant suppression of AIA compared with rAAV.EGFP control, as reflected in the mainly clinical signs including articular index, ankle joint thickness and paw swelling and typically histological characters of arthritic joints including synovial hyperplasia, inflammatory cells infiltration and cartilage degradation. Treatment with rAAV.CTLA4-FasL also significantly decreased the levels of key proinflammatory cytokines in AIA joints. Moreover, local productions of transgene mRNA and protein of CTLA4-FasL were found in injected joints without systemic distribution. Our results indicate that rAAV.CTLA4-FasL profoundly suppressed experimental model of RA, implicating the potential therapeutic applications for suppression of RA by local joint delivery of CTLA4-FasL.