Studies in an in vitro model of cutaneous T-cell lymphoma (CTCL) demonstrated that CTCL cell proliferation is stimulated by direct contact with autologous, immature dendritic cells (DCs), suggesting that CD4⁺ CTCL cell division is driven by antigens presented by DC major histocompatibility complex (MHC) class 2. We now report that the T-cell receptor (TCR) of the CD4⁺ CTCL cells is triggered after interaction with DCs loaded with apoptotic CTCL cells, as shown by reduced membrane expression of CD3 and the TCR, up-regulation of cytotoxic T lymphocyte antigen-4 (CTLA-4), and calcium mobilization. CTCL cells adopt a T-regulatory (Treg) phenotype expressing CD25/CTLA-4 and FoxP3 and secreting interleukin-10 (IL-10) and transforming growth factor-β (TGF-β). Treg CTCL cells suppress normal T-cell antigen-driven secretion of IL-2 and interferon-γ (IFN-γ). Blocking DC MHC class 2 expression or transport inhibited CTCL cell adoption of a Treg phenotype. Allogeneic CTCL cells or normal CD4 T cells served as sources of apoptotic material for CTCL cell conversion to a Treg phenotype. Conversion of CTCL cells to Treg cells may explain the anergic, immunosuppressive nature of the malignancy. (Blood. 2005;105:1640-1647)