Regulatory T cells (Treg) play important roles in suppressing immune responses and maintaining tolerance. Rabbit antithymocyte globulin (rATG) and horse ATG (hATG) are widely used in the treatment of immune-mediated syndromes, but their effects on Treg are unknown. We show here that in vitro culture of normal human peripheral blood mononuclear cells (PBMCs) with a low-dose rATG resulted in marked expansion of functional Treg by converting CD4⁺CD25⁻ T cells to CD4⁺CD25⁺ T cells. hATG did not expand but rather decreased Treg. Immuno-blot showed increased expression of FOXP3 and NFAT1 in CD4⁺CD25⁻ and CD4⁺CD25⁺ T cells exposed to rATG. PBMCs treated with rATG displayed increased interleukin-10 in culture supernatants than those treated with hATG. Furthermore, rATG and hATG showed differences in their potential to stimulate CD4⁺ T cells as examined using different activation markers. Microarray revealed that rATG induced markedly different gene-expression patterns in PBMCs, compared with hATG-treated or untreated PBMCs. Our findings indicate that rATG expanded Treg, probably through transcriptional regulation by enhanced NFAT1 expression, in turn conferring CD4⁺CD25⁻ T cell FOXP3 expression and regulatory activity. The therapeutic effects of rATG may occur not only because of lymphocyte depletion but also enhanced Treg cell number and function.