Suppressor of cytokine signaling 1 (SOCS1) is an important negative regulator for cytokines; however, the role of SOCS1 in Th17 differentiation has not been clarified. We generated T cell-specific SOCS1-deficient mice and found that these mice were extremely resistant to a Th17-dependent autoimmune disease model, experimental autoimmune encephalomyelitis. SOCS1-deficient naive CD4(+) T cells were predominantly differentiated into Th1 and poorly into Th17 in vitro. These phenotypes were canceled in IFN-gamma(-/-) background, suggesting that a large amount of IFN-gamma in SOCS1-deficient T cells suppressed Th17 differentiation. IL-6 plus TGF-beta enhanced retinoic acid receptor-related orphan receptor (ROR)-gammat expression and suppressed IFN-gamma production in wild-type T cells, whereas these effects were severely impaired in SOCS1-deficient T cells. These phenotypes can be partly explained by STAT3 suppression by enhanced SOCS3 induction through hyper-STAT1 activation in SOCS1-deficient T cells. In addition, SOCS1-deficient T cells were much less sensitive to TGF-beta. Suppression of Th1 differentiation by TGF-beta was impaired in SOCS1-deficient T cells. TGF-beta-mediated Smad transcriptional activity was severely inhibited in SOCS1-deficient cells in the presence of IFN-gamma. Such impairment of TGF-beta functions were not observed in SOCS3-overexpressed cells, indicating that suppression of Smads was independent of SOCS3. Therefore, SOCS1 is necessary for Th17 differentiation by suppressing antagonistic effect of IFN-gamma on both STAT3 and Smads. Induction of SOCS3 can partly explain IFN-gamma-mediated STAT3 suppression, while other mechanism(s) will be involved in IFN-gamma-mediated Smad suppression. SOCS1-deficient T cells will be very useful to investigate the molecular mechanism for the STAT1-mediated suppression of Th17 development.