Constitutive Fas ligand (FasL) expression by specialized cells in the body participates in the immune privilege status of tissues containing these cells. This property has been used to prevent rejection of allogeneic grafts. Nevertheless, the mechanism responsible for such protection has not been fully elucidated. Unfortunately, grafting of FasL transgenic (TG) tissues has been unsuccessful. We have generated TG mice expressing FasL (soluble + membrane bound) on thyroid follicular cells (TFC), and used them to show that ectopic FasL expression prevents thyroid allograft rejection. FasL expression on TFC led to markedly decreased anti-allogeneic, cytotoxic, and helper T lymphocyte activities. The alloantibody response in TG thyroid recipients was either completely inhibited or switched toward a T2-Ab response. Surprisingly, the beneficial effect of FasL on TG thyroid grafts was abolished by host CD4(+) T cell depletion. Host CD8(+) T cell depletion improved nontransgenic (NTG), but not TG graft survival. Altogether, our results suggest that FasL-induced tolerance is concomitant with a move away from a T1 type response, and a CD4 T cell-mediated regulation of the allocytotoxic T cell response. These results were dependent upon the level of FasL expression on TFC, in that low expression of FasL led to a less marked effect compared with the effect observed with high expression of FasL. These results provide some insight into the role of FasL in regulating destructive alloimmune responses in the case of whole organ grafting, and they have important implications for the development of FasL-based immunotherapy in organ transplantation.