CD83 is an immunoglobulin (Ig) superfamily member that is upregulated during the maturation of dendritic cells (DCs). It has been widely used as a marker for mature DCs, but its function is still unknown. To approach its potential functional role, we have expressed the extracellular Ig domain of human CD83 (hCD83ext) as a soluble protein. Using this tool we could show that immature as well as mature DCs bind to CD83. Since CD83 binds a ligand also expressed on immature DCs, which do not express CD83, indicates that binding is not a homophilic interaction. In addition we demonstrate that hCD83ext interferes with DC maturation downmodulating the expression of CD80 and CD83, while no phenotypical effects were observed on T cells. Finally, we show that hCD83ext inhibits DC-dependent allogeneic and peptide-specific T cell proliferation in a concentration dependent manner in vitro. This is the first report regarding functional aspects of CD83 and the binding of CD83 to DCs.