Fas Ligand (FasL) can induce apoptosis of Fas-bearing cells. It is expressed on the cell surface of many tumor cells, immune-privileged tissues and activated lymphocytes. We report here that FasL can itself transduce signals, leading to cell-cycle arrest and cell death in CD4+ T cells. In vitro, FasL engagement inhibited CD4+ T-cell proliferation, cell-cycle progression, and IL-2 secretion. In vivo, FasL engagement prevented superantigen-mediated CD4+, but not CD8+, T-cell expansion. These findings demonstrate that FasL engagement regulates cell-cycle progression, and show that FasL engagement in vivo has a potent anti-inflammatory effect specific for CD4+ T cells.