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Since negative selection in the thymus is incomplete, some self-reactive T cells are able to mature and seed the periphery. To study how these T cells interact following encounter with the self-protein they recognize in the periphery, we have developed an adoptive transfer system in which HEL-specific TCR transgenic CD4 T cells are transferred to mice expressing HEL protein in the pancreas under the control of the rat insulin promoter. Here we show that after adoptive transfer of HEL-specific T cells functional tolerance is maintained despite evidence that the T cells encounter and respond to pancreas-expressed antigen. Even the provision of an additional activation stimulus by peripheral immunization with HEL protein is insufficient to induce the T cells to cause autoimmune tissue injury. However, in the presence of blocking anti-CTLA-4-mAb, immunized adoptive transfer recipients rapidly developed diabetes. These data suggest that the CTLA-4 pathway regulates the pathogenicity of antigen-specific T cells following a peripheral activation stimulus.