This study demonstrates that the 175-kDa form of dipeptidyl peptidase IV (DPPIV) found in normal human serum is identical with a similarly-sized Ag, DPPT-L, found to be rapidly expressed on the surface of activated T cells. As activation progresses, the expression of DPPT-L reaches a peak on day 3, after which expression falls, whereas expression of the 105-kDa CD26/DPPIV detected by the mAb 1F7 increases, as does the ability to bind adenosine deaminase. The loss of DPPT-L from the surface of activated T cells correlates exactly with the appearance of DPPT-L and DPPIV activity in serum-free tissue culture medium. The release of DPPIV was generally greater from CD4+ cells than from CD8+ T cells, and within the CD4+ subset, the CD45RO+ subset was the major source, which correlated with surface expression before culture. We show that the DPPIV released from activated T cells is antigenically, biochemically, and enzymatically similar to DPPIV circulating in the serum and is distinct from the DPPIV activity of 105-kDa CD26. The T cell-released DPPIV is able to function as a costimulating molecule for the response to the recall Ag, tetanus toxoid, at levels similar to those at which recombinant soluble CD26 and serum DPPIV exhibit costimulatory function, suggesting that the released DPPIV may serve an important immunoregulatory function in vivo, both locally and within the systemic circulation.