Cytotoxic T lymphocyte antigen-4 (CTLA-4) plays a critical role in negatively regulating T cell responses and has also been implicated in the development and function of natural FOXP3⁺ regulatory T cells. CTLA-4–deficient mice develop fatal, early onset lymphoproliferative disease. However, chimeric mice containing both CTLA-4–deficient and –sufficient bone marrow (BM)–derived cells do not develop disease, indicating that CTLA-4 can act in trans to maintain T cell self-tolerance. Using genetically mixed blastocyst and BM chimaeras as well as in vivo T cell transfer systems, we demonstrate that in vivo regulation of Ctla4^−/− T cells in trans by CTLA-4–sufficient T cells is a reversible process that requires the persistent presence of FOXP3⁺ regulatory T cells with a diverse TCR repertoire. Based on gene expression studies, the regulatory T cells do not appear to act directly on T cells, suggesting they may instead modulate the stimulatory activities of antigen-presenting cells. These results demonstrate that CTLA-4 is absolutely required for FOXP3⁺ regulatory T cell function in vivo.