The transforming growth factor beta (TGF-beta) family of proteins are a set of pleiotropic secreted signaling molecules with unique and potent immunoregulatory properties. TGF-beta 1 is produced by every leukocyte lineage, including lymphocytes, macrophages, and dendritic cells, and its expression serves in both autocrine and paracrine modes to control the differentiation, proliferation, and state of activation of these immune cells. TGF-beta can modulate expression of adhesion molecules, provide a chemotactic gradient for leukocytes and other cells participating in an inflammatory response, and inhibit them once they have become activated. Increased production and activation of latent TGF-beta have been linked to immune defects associated with malignancy and autoimmune disorders, to susceptibility to opportunistic infection, and to the fibrotic complications associated with chronic inflammatory conditions. In addition to these roles in disease pathogenesis, TGF-beta is now established as a principal mediator of oral tolerance and can be recognized as the sine qua non of a unique subset of effector cells that are induced in this process. The accumulated knowledge gained through extensive in vitro functional analyses and from in vivo animal models, including newly established TGF-beta gene knockout and transgenic mice, supports the concept that clinical therapies based on modulation of this cytokine represent an important new approach to the treatment of disorders of immune function.