Differentiation of uncommitted T cells into Th1 and Th2 subpopulations depends on both intracellular events controlling expression of transcription factors T-bet and GATA-3 and interactions between cells mediated by cytokines, particularly IL4 and IFNgamma. A great deal is known about the intracellular and extracellular events involved in Th1 and Th2 (Th) differentiation, but how these are integrated in T-cell populations or indeed why extracellular cytokine control is required after a decision has been made at a transcriptional level is not at all understood. We present a mathematical model of CD4+ T-cell differentiation that describes both intracellular and extracellular processes and the interactions between them. It shows how antigen stimulation in conjunction with cytokines and other extracellular signals gives rise to rapid, reversible and mutually exclusive expression of T-bet or GATA-3 due to feedback between the transcription factors and their signalling pathways. After transient signalling by APC, continued Th1 and Th2 differentiation is shown to require cytokine production by the proliferating T cells. Moreover, intercellular communication by T-cell-derived cytokines lowers the threshold of APC signals required for Th differentiation. This provides an explanation for enhanced Th differentiation by pre-existing memory T cells. The model also predicts that Th differentiation can be reversed at the single cell level before commitment by manipulating the cytokine environment. It suggests a mechanism for switching between Th1 and Th2 in the so-called irreversible state that may be developed as a novel therapeutic means of manipulating Th1 and Th2 responses.