Human endothelial cells (ECs) provide costimulatory signals sufficient to activate resting memory T cells to produce IL-2 and IFN-γ, at least in part through CD58-CD2 interactions. Recently, the B7-like molecule, B7-H1 (PD-L1), was described and shown to regulate T cell activation; however, there are conflicting reports on whether it stimulates or inhibits T cell cytokine synthesis. B7-H1 is not expressed constitutively by ECs; however, it is rapidly induced by IFN-γ, and synergistically by IFN-γ and TNF. In inflamed skin, B7-H1 is expressed by a subset of microvessels, and by keratinocytes, but is barely detectable in normal skin. Blocking the interaction of EC-expressed B7-H1 with its T cell ligand, programmed death-1 (PD-1), using a PD-1-Fc fusion protein, or by blocking B7-H1 expression with morpholino antisense oligonucleotides, augments expression of IL-2 and IFN-γ, implicating B7-H1 as a negative regulator of cytokine synthesis. However, signaling through PD-1 does not affect induction of the activation markers CD25 or CD69 on T cells, suggesting that its effects are specific to cytokine synthesis. The suppressive effects of B7-H1 on cytokine expression are proportional to the strength of the primary stimulus, allowing for B7-H1 to determine the level of T cell activation in response to ECs. Our results demonstrate that B7-H1 negatively regulates cytokine synthesis in T cells activated by ECs.