Transfer of naive antigen-specific CD4(+) T cells into lymphopenic mice that express an endogenous antigen as a systemic, secreted protein results in severe autoimmunity resembling graft-versus-host disease. T cells that respond to this endogenous antigen develop into effector cells that cause the disease. Recovery from this disease is associated with the subsequent generation of FoxP3(+)CD25(+) regulatory cells in the periphery. Both pathogenic effector cells and protective regulatory cells develop from the same antigen-specific T cell population after activation, and their generation may occur in parallel or sequentially. Interleukin (IL)-2 plays a dual role in this systemic T cell reaction. In the absence of IL-2, the acute disease is mild because of reduced T cell effector function, but a chronic and progressive disease develops late and is associated with a failure to generate FoxP3(+) regulatory T (T reg) cells in the periphery. Thus, a peripheral T cell reaction to a systemic antigen goes through a phase of effector cell-mediated pathology followed by T reg cell-mediated recovery, and both require the growth factor IL-2.