Gammadelta T cells are highly cytolytic lymphocytes that produce large amounts of pro-inflammatory cytokines during immune responses to multiple pathogens. Furthermore, their ability to kill tumor cells has fueled the development of gammadelta-T-cell-based cancer therapies. Thus, the regulation of gammadelta-T-cell activity is of great biological and clinical relevance. Here, we show that murine CD4+CD25+ alphabeta T cells, the vast majority of which express the Treg marker, Foxp3, abolish key effector functions of gammadelta T cells, namely the production of the pro-inflammatory cytokines, IFN-gamma and IL-17, cytotoxicity, and lymphocyte proliferation in vitro and in vivo. We further show that suppression is dependent on cellular contact between Treg and gammadelta T cells, results in the induction of an anergic state in gammadelta lymphocytes, and can be partially reversed by manipulating glucocorticoid-induced TNF receptor-related protein (GITR) signals. Our data collectively dissect a novel mechanism by which the expansion and pro-inflammatory functions of gammadelta T cells are regulated.