Background: In vitro studies have shown that the active form of vitamin D-3, 1 alpha,25-dihydroxyvitamin D3 (1,25(OH)(2)D-3), can regulate differentiation of CD4(+) T cells by inhibiting Th1 and Th17 cell differentiation and promoting Th2 and Treg cell differentiation. However, the serum concentration of 1,25(OH)(2)D-3 is far below the effective concentration of 1,25 (OH)(2)D-3 found in in vitro studies, and it has been suggested that 1,25(OH)(2)D-3 must be produced locally from the inactive precursor 25-hydroxyvitamin D3 (25(OH)D-3) to affect ongoing immune responses in vivo. Although it has been reported that activated T cells express the 25(OH)D-1 alpha-hydroxylase CYP27B1 that converts 25(OH)D-3 to 1,25(OH)(2)D-3, it is still controversial whether activated T cells have the capacity to produce sufficient amounts of 1,25(OH)(2)D-3 to affect vitamin D-responsive genes. Furthermore, it is not known how the vitamin D-binding protein (DBP) found in high concentrations in serum affects T cell responses to 25(OH)D-3. Results: We found that activated T cells express CYP27B1 and have the capacity to produce sufficient 1,25(OH)(2)D-3 to affect vitamin D-responsive genes when cultured with physiological concentrations of 25(OH)D-3 in serum-free medium. However, if the medium was supplemented with serum or purified DBP, DBP strictly inhibited the production of 1,25(OH)(2)D-3 and 25(OH)D-3-induced T cell responses. In contrast, DBP did not inhibit the effect of exogenous 1,25(OH)(2)D-3. Actin, arachidonic acid and albumin did not affect the sequestration of 25(OH)D-3 by DBP, whereas carbonylation of DBP did. Conclusions: Activated T cells express CYP27B1 and can convert 25(OH)D-3 to 1,25(OH)(2)D-3 in sufficiently high concentrations to affect vitamin D-responsive genes when cultured in serum-free medium. However, DBP sequesters 25(OH)D-3 and inhibits the production of 1,25(OH)(2)D-3 in T cells. To fully exploit the immune-regulatory potential of vitamin D, future studies of the mechanisms that enable the immune system to exploit 25(OH)D-3 and convert it to 1,25(OH)(2)D-3 in vivo are required.