Dendritic cells (DCs) are specialized antigen-presenting cells that migrate from the periphery to lymphoid tissues, where they activate and regulate T cells. Genetic modification of DCs to express immunoregulatory molecules would provide a new immunotherapeutic strategy for autoimmune and other diseases. We have engineered bone marrow-derived DCs that express IL-4 and tested the ability of these cells to control murine collagen-induced arthritis (CIA), a model for rheumatoid arthritis in which Th1 cells play a critical role. IL-4-transduced DCs inhibited Th1 responses to collagen type II in vitro. A single injection of IL-4-transduced DCs reduced the incidence and severity of CIA and suppressed established Th1 responses and associated humoral responses, despite only transient persistence of injected DCs in the spleen. In contrast, control DCs and IL-4-transduced T cells or fibroblastic cells failed to alter the course of the disease. The functional effects correlated well with the differential efficiency of DC migration from various sites of injection to lymphoid organs, especially the spleen. The ability of splenic T cells to produce IL-4 in response to anti-CD3 was enhanced after the administration of IL-4-transduced DCS: These results support the feasibility of using genetically modified DCs for the treatment of autoimmune disease.