Immune and inflammatory systems are controlled by multiple cytokines, including interleukins and interferons. Many of these cytokines exert their biological functions through JAKs (Janus tyrosine kinases) and STAT (signal transduction and activators of transcription) transcription factors. CIS (cytokine-inducible SH2 (Src homology 2) protein) and SOCS (suppressor of cytokine signaling) are a family of intracellular proteins, several of which have emerged as key physiological regulators of cytokine-mediated homeostasis, including innate and adaptive immunity. In this review we focus on the molecular mechanism of the action of CIS/SOCS family proteins and their roles in immune regulation and inflammatory diseases including rheumatoid arthritis.