Cytotoxic CD8(+) T cells (CTLs) contain virus infections through the release of granules containing both perforin and granzymes. T cell 'exhaustion' is a hallmark of chronic persistent viral infections including HIV. The inhibitory regulatory molecule, T cell Immunoglobulin and Mucin domain containing 3 (Tim-3) is induced on HIV-specific T cells in chronic progressive infection. These Tim-3 expressing T cells are dysfunctional in terms of their capacities to proliferate or to produce cytokines. In this study, we evaluated the effect of Tim-3 expression on the cytotoxic capabilities of CD8(+) T cells in the context of HIV infection. We investigated the cytotoxic capacity of Tim-3 expressing T cells by examining 1) the ability of Tim-3(+) CD8(+) T cells to make perforin and 2) the direct ability of Tim-3(+) CD8(+) T cells to kill autologous HIV infected CD4(+) target cells. Surprisingly, Tim-3(+) CD8(+) T cells maintain higher levels of perforin, which was mainly in a granule-associated (stored) conformation, as well as express high levels of T-bet. However, these cells were also defective in their ability to degranulate. Blocking the Tim-3 signalling pathway enhanced the cytotoxic capabilities of HIV specific CD8(+) T cells from chronic progressors by increasing; a) their degranulation capacity, b) their ability to release perforin, c) their ability to target activated granzyme B to HIV antigen expressing CD4(+) T cells and d) their ability to suppress HIV infection of CD4(+) T cells. In this latter effect, blocking the Tim-3 pathway enhances the cytotoxcity of CD8(+) T cells from chronic progressors to the level very close to that of T cells from viral controllers. Thus, the Tim-3 receptor, in addition to acting as a terminator for cytokine producing and proliferative functions of CTLs, can also down-regulate the CD8(+) T cell cytotoxic function through inhibition of degranulation and perforin and granzyme secretion.