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We have established that, in mice receiving donor-specific immunization by the portal vein, the increased graft survival seen is associated with the increased expression of a molecule (OX-2) on a subpopulation of dendritic cells (DC), and polarization of cytokine production to type 2 cytokines on Ag-specific restimulation of cells from these mice. Furthermore, infusion of a mAb to OX-2 blocks both the increased graft survival and the altered cytokine production seen. We have constructed an immunoadhesin in which the extracellular domain of OX-2 is linked to the murine IgG2a Fc region, and we have expressed this molecule (OX-2:Fc) in a eukaryotic (baculovirus) expression system. Incubation of lymphocytes with 50 ng/ml OX-2:Fc inhibits a primary mixed lymphocyte reaction in vitro, as assayed by proliferation and induction of cytotoxic T cells, and also alters cytokine production with decreased IL-2 (IFN-gamma) production and increased IL-4 (IL-10) production. Similarly, in vivo infusion of OX-2:Fc promotes increased allo- and xenograft (both skin and renal grafts) survival and decreases the Ab response to sheep erythrocytes. Our data suggest this molecule might have clinical importance in allo- and xenotransplantation.