Thymic epithelial cells participate in tolerance induction by deleting or inducing anergy of autoreactive lymphocytes. To explore this process in vitro, the antigen-presenting function of thymic epithelial cell lines was evaluated using a panel of T hybridoma and cloned cells displaying the same antigenic specificity. These mouse thymic epithelial cell lines could process different exogenous antigens and stimulate T hybridoma cells but only induced a partial activation of helper cloned T cells. This state of incomplete activation was characterized by the inability to produce IL-2 and IFN-gamma upon antigenic stimulation, whereas T cell IL-2R alpha expression and cytolytic potential were optimally induced. Thymic epithelial cells failed to express CD28 ligands detected by a CTLA-4/Ig probe even after induction by IFN-gamma. Optimal cloned T cell activation was only observed in the presence of LPS blasts or exogenous IL-2. Costimulation with anti-CD28 mAb was found to restore IFN-gamma but not IL-2 production. Thus, T cell activation by thymic epithelial cell lines provides a useful model to further dissect the requirements for costimulatory molecules, which, in addition to CD28, are required for optimal T cell activation.