Foxp3(+) regulatory T cells (T(regs)) contribute significantly to the maintenance of peripheral tolerance, but they ultimately fail in autoimmune diseases. The events that lead to T(reg) failure in controlling autoreactive effector T cells (T(effs)) during autoimmunity are not completely understood. In this review, we discuss possible mechanisms for this subversion as they relate to type 1 diabetes (T1D) and multiple sclerosis (MS). Recent studies emphasize firstly, the role of inflammatory cytokines, such as IL-6, in inhibiting or subverting T(reg) function; secondly, the issue of T(reg) plasticity; thirdly, the possible resistance of autoimmune T cells to T(reg)-mediated control; and fourthly, T(reg)-associated inhibitory cytokines TGFbeta, IL-10 and IL-35 in facilitating T(reg) suppressive activity and promoting T(reg) generation. These recent advances place a large emphasis on the local tissue specific inflammatory environment as it relates to T(reg) function and disease development.