Previous studies on thymocyte differentiation by using reaggregate cultures (RC) of double positive T cell receptor (TCR) transgenic thymocytes and the thymic epithelial cell line ANV indicated that low concentrations of high affinity ligands for the TCR were efficient inducers of thymocyte maturation to CD4 single positive (SP) functional cells. In this study, it is demonstrated that, when high concentrations of high affinity ligands are used in this RC system, double positive (DP) cells down-modulate expression of both coreceptors and that, as a result, large numbers of double negative (DN) cells are generated. These DN cells proliferated modestly in response to stimulation by antigen, and this response was considerably augmented by the addition of IL-2 to the cultures. Notably, these antigen-stimulated DN cells produced large amounts of IL-10. When the DN cells generated in RC were cocultured with naive TCR transgenic T cells in the presence of antigen, they suppressed the proliferative response of the naive T cells. Thus, high affinity ligands, when presented to DP thymocytes by cortical thymic epithelial cells in reaggregate cultures, rather than causing deletion of the immature thymocytes, induce their differentiation into immunoregulatory DN cells, suggesting a distinct mechanism by which self tolerance may be maintained.