Engagement of CTLA-4 is critical for inhibiting T cell immune responses. Recent studies have shown that CTLA-4 plays a key role in regulating peripheral T cell tolerance. It has been suggested that one mechanism by which CTLA-4 performs this function is by regulating cell cycle progression. Here, we investigate in depth the role of CTLA-4 in regulating cell cycle progression in naive T cells by comparing the immune responses in the absence or presence of CTLA-4. In the absence of CLTA-4, T cells exhibit marked increases in T cell proliferation, IL-2 mRNA and protein secretion, and cells cycling in the S and G2-M phase. Analyses of cyclins, cyclin-dependent kinases, and cell cycle inhibitors involved in the transition from the G1 to S phase reveal that cell cycle progression is prolonged in the absence of CTLA-4. This is due to the early exit from the G1 phase, entry into the S phase, and prolonged S phase period. Re-expression of the cell cycle inhibitor p27(kip1) is delayed in the absence of CTLA-4. These studies demonstrate that the B7 : CTLA-4 pathway exerts its major effects on T cell immune responses via regulation of the cell cycle.