Schistosoma mansoni soluble egg antigens (SEA) profoundly regulate the infected host's immune system. We previously showed that SEA prevents type 1 diabetes in NOD mice and that splenocytes from SEA-treated mice have reduced ability to transfer diabetes to NOD.scid recipients. To further characterize the mechanism of diabetes prevention we examined the cell types involved and showed that CD25(+) T-cell depletion of splenocytes from SEA-treated donors restored their ability to transfer diabetes. Furthermore, SEA treatment increased the number and proportional representation of Foxp3(+) T cells in the pancreas of NOD mice. We have used in vitro systems to analyze the effect of SEA on the development of NOD Foxp3(+) T cells. We find that SEA can induce Foxp3 expression in naïve T cells in a TGF-beta-dependent manner. Foxp3 induction requires the presence of DC, which we also show are modified by SEA to upregulate C-type lectins, IL-10 and IL-2. Our studies show that SEA can have a direct effect on CD4(+) T cells increasing expression of TGF-beta, integrin beta8 and galectins. These effects of SEA on DC and T cells may act in synergy to induce Foxp3(+) Treg in the NOD mouse.