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The B7 family members are critical in positive and negative regulation of immune responses by engaging various lymphocyte receptors. B7-H4 is a member of the B7 family that can negatively regulate T cell function. We investigated the role of host and donor B7-H4 in regulating acute graft-versus-host disease (GVHD). Allogeneic donor T cells infused into B7-H4−/− versus wild type (WT) recipients markedly accelerated GVHD-induced lethality in a C57BL/6 to BALB/c GVHD model. Chimera studies pointed toward B7-H4 expression on host hematopoietic cells as more critical than parenchymal cells in controlling GVHD. B7-H4−/− recipients had rapid mortality associated with increased donor T cell expansion, gut T cell homing and loss of intestinal epithelial integrity, increased Teffector function (proliferation, pro-inflammatory cytokines, cytolytic molecules) and reduced apoptosis. Higher metabolic demands of rapidly proliferating donor T cells in B7-H4−/− versus WT recipients required multiple metabolic pathways, increased extra-cellular acidification rates and oxygen consumption rates, and increased expression of fuel substrate transporters. Interestingly, during GVHD, B7-H4 expression was upregulated on allogeneic WT donor T cells. Consistent with these data, donor B7-H4−/− T cells given to WT recipients increased GVHD mortality and functioned similarly to WT T cells from allogeneic B7-H4−/− recipients. Graft-versus-leukemia responses were intact regardless as to whether B7-H4−/− mice were used as hosts or donors. Taken together, these data provide new insights into the negative regulatory processes that control GVHD and provide support for developing therapeutic strategies directed toward the B7-H4 pathway.