We have recently described that human autologous rosette-forming (Tar) cells have the characteristics of postthymic precursor cells. Herein we report that we found circulating Tar cells significantly diminished in 32 patients with untreated systemic lupus erythematosus (SLE) as compared to 32 age/sex matched controls. Pretreatment of peripheral blood mononuclear cells (MNC) from SLE patients with serum from young normal adults or wtih serum thymic factors (FTS) increased their percentages of Tar cells significantly but reached near normal values in only 3 patients with inactive disease. Patients and normal subjects had similar percentages of Tar cells binding peanut-agglutinin. Characteristic functions of postthymic precursor cells are feedback inhibition and generation of suppressor cells which we studied in systems where we depleted or added Tar cells to Tmu and B cells, or MNC, respectively, using as indicators the production of immunoglobulins measured in culture supernatants or 3H-thymidine incorporation. We found both functions diminished in SLE patients despite using the presence of a qualitative as well as quantitative defect. In two SLE patients studied both of these functions corrected partially when their Tar cells were pretreated with FTS. In 20 SLE patients we studied Tgamma and Tmu cells as well as Concanavalin-A-induced, spontaneously-expanded suppression and found Concanavalin-A-induced, spontaneously-expanded suppressor function and Tgamma cells diminished. However only the reduction of Tgamma and of spontaneously-expanded suppressor function were found to relate to disease activity. On the other hand, Tmu cells were found to be similar in numbers in SLE patients and normal controls.