Human CD4⁺CD39⁺ regulatory T (Treg) cells hydrolyze exogenous adenosine triphosphate (ATP) and participate in immunosuppressive adenosine production. They contain two T‐cell subsets whose role in mediating suppression is not understood. Frequencies of both CD4⁺CD39⁺ subsets were evaluated in peripheral blood lymphocytes of 57 cancer patients and in tumor infiltrating lymphocytes (TILs) of 6 patients. CD4⁺CD39⁺ and CD4⁺CD39^neg T cells isolated using immunobeads and cell sorting were cultured under various conditions. Their conversion into CD39⁺FOXP3⁺CD25⁺ or CD39⁺FOX^negCD25^neg cells was monitored by multiparameter flow cytometry. Hydrolysis of exogenous ATP was measured in luminescence assays. Two CD4⁺CD39⁺ cell subsets differing in expression of CD25, FOXP3, CTLA‐4, CD121a, PD‐1, latency associated peptide (LAP), glycoprotein A repetitions predominant (GARP), and the cytokine profile accumulated with equal frequencies in the blood and tumor tissues of cancer patients. The frequency of both subsets was significantly increased in cancer. CD39 expression levels correlated with the subsets’ ability to hydrolyze ATP. Conventional CD4⁺CD39^neg T cells incubated with IL‐2 + TGF‐β expanded to generate CD4⁺CD39⁺FOXP3⁺ Treg cells, while CD4⁺CD39⁺FOXP3^negCD25^neg subset cells stimulated via the TCR and IL‐2 converted to FOXP3⁺CTLA4⁺CD25⁺ TGF‐β‐expressing Treg cells. Among CD4⁺CD39⁺ Treg cells, the CD4⁺CD39⁺FOXP3^negCD25^neg subset serves as a reservoir of cells able to convert to Treg cells upon activation by environmental signals.