Optimal T cell activation requires at least two signals. One is provided by the interaction between antigen-specific T cell receptor and antigen-MHC complexes. The other is provided by costimulatory signals. One best characterized costimulation is mediated by CD28/CTLA4-CD80/CD86 (CD28/B7). In the past decade, costimulatory signal mediated by CD28 has been shown to be critical to augment T cell proliferative response and effector function such as cytokine production. Recent intensive analysis of the CD28/B7 pathway have revealed unexpected means in which this pathway may be involved in the maintenance and breakdown of self-tolerance. In vivo studies using antagonists or transgenes of this pathway reveals that inappropriate expression of CD80, ligand for CD28/CTLA4, could induce autoimmunity and blockade of CD28/B7 pathway could ameliolate several autoimmune disease models. Furthermore, CD80 and CD86 plays differential roles for the development of autoimmune disease since helper T cell development is differentially affected by the blockade of either. CD80 or CD86 in certain conditions. More recent studies demonstrated the crucial role of CTLA4 in negatively regulating T cell activation and autoreactivity. Taken together, this pathway play pivotal roles for autoimmunity, and manipulation of this pathway raises the possibility for controlling autoimmune diseases.