The principal aim of the immune system is to establish a balance between defense against pathogens and avoidance of autoimmune disease. This balance is achieved partly through regulatory T cells (Tregs). CD4(+)CD25(+) Tregs are either naturally occurring or induced by antigens and are characterized by the expression of the X-linked forkhead/winged helix transcription factor, Foxp3. Here we report a previously unrecognized subset of CD4+CD25+ Tregs derived from CD4(+)CD25(-) Tcells induced by nitric oxide (NO). The induction of Tregs (NO-Tregs) is independent of cGMP but depends on p53, IL-2, and OX40. NO-Tregs produced IL-4 and IL-10, but not IL-2, IFN gamma, or TGF beta. The cells were GITR(+), CD27(+), T-bet(low), GATA3(high), and Foxp3(-). NO-Tregs suppressed the proliferation of CD4+CD25- T cells in vitro and attenuated colitis- and collagen-induced arthritis in vivo in an IL-10-dependent manner. NO-Tregs also were induced in vivo in SCID mice adoptively transferred with CD4+CD25- T cells in the presence of LIPS and IFN gamma, and the induction was completely inhibited by N-G-monomethyl-L-argi nine, a pan NO synthase inhibitor. Therefore, our findings uncovered a previously unrecognized function of NO via the NO-p53-IL-2-OX40-survivin signaling pathway for T cell differentiation and development.