The immune co-inhibitory receptors lymphocyte activation gene-3 (LAG3) and programmed cell death 1 (PD1) synergistically contribute to autoimmunity and tumor evasion. Here we demonstrate how they collaborate and interact to regulate T cell function. We first show that LAG3 and PD1 are co-expressed on both OVA-specific and non-specific T cells infiltrating murine ovarian tumors. Dual antibody blockade or genetic knockout of LAG3 and PD1 significantly enhanced T effector function and delayed tumor growth. LAG3 and PD1 co-localized in activated CD8+ T cells in vitro at the trans-Golgi vesicles, early/recycling endosomal compartments, lysosomes, and microtubule organizing center. Importantly, LAG3 and PD1 cluster with pLck at the immunological synapse. Reciprocal immunoprecipitation of T cell extracts revealed physical interaction between LAG3 and PD1. Mutational analyses indicate that the cytoplasmic domain of LAG3 is not absolutely required for its association with PD1, while the ITIM and ITSM of PD1 are necessary for its association with LAG3. Finally, LAG3 protein also associates with the Src-homology-2 domain-containing phosphatases (SHP1/2) which are known to be recruited by PD1 during T cell signaling. Our data indicate that the association of LAG3 with PD1 contributes to their rapid trafficking to the immunological synapse, leading to a synergistic inhibitory effect on T cell signaling.