The capacity of naturally occurring autoreactive CD25+CD4+ regulatory T cells (Treg) to control immune responses both in vivo and in vitro is now well established. It has been demonstrated that these cells undergo positive selection within the thymus and appear to enter the periphery as committed CD25+CD4+ Treg. We have shown previously that CD25+CD4+ Treg with the capacity to prevent skin allograft rejection can be generated by pretreatment with donor alloantigen under the cover of anti-CD4 therapy. Here we demonstrate that this process does not require an intact thymus. Furthermore, generation of these Treg is not dependent on the expansion of CD25+CD4+ thymic emigrants, because depletion of CD25+ cells before pretreatment does not prevent Treg development, and Treg can be generated from CD25-CD4+ precursors. Taken together, these results clearly demonstrate that CD25+CD4+ Treg can be generated in the periphery from CD25-CD4+ precursors in a pathway distinct to that by which naturally occurring autoreactive CD25+CD4+ Treg develop. These observations may have important implications for the design of protocols, both experimental and clinical, for the induction of tolerance to autoantigens or alloantigens in adults with limited thymic function.