Background: CD4(+)CD25(+) regulatory T (T-reg) cells develop in the thymus and can suppress T cell proliferation, modulated by Foxp3 and cytokines; however, the relevance of CD44 in T-reg cell development is less clear. To address this issue, we analyzed Foxp3 expression in CD44(+)T(reg) cells by using multiple parameters, measured the levels of the immunoregulatory cytokine interleukin (IL)-10 in various thymocyte subsets, and determined the suppressor activity in different splenic T-reg cell populations. Results: Within mouse thymocytes, we detected T-reg cells with two novel phenotypes, namely the CD4(+)CD8(-)CD25(+)CD44(+) and CD4(+)CD8(-)CD25(+)CD44(-) staining features. Additional multiparameter analyses at the single-cell and molecular levels suggested to us that CD44 expression positively correlated with Foxp3 expression in thymocytes, the production of IL-10, and T-reg activity in splenic CD4(+)CD25(+) T cells. This suppressive effect of T-reg cells on T cell proliferation could be blocked by using anti-IL-10 neutralizing antibodies. In addition, CD4(+)CD25(+)CD44(+) T-reg cells expressed higher levels of IL-10 and were more potent in suppressing effector T cell proliferation than were CD4(+)CD25(+)CD44(-) cells. Conclusion: This study indicates the presence of two novel phenotypes of T-reg cells in the thymus, the functional relevance of CD44 in defining T-reg cell subsets, and the role of both IL-10 and Foxp3 in modulating the function of T-reg cells. Reviewers: This article was reviewed by Dr. M. Lenardo, Dr. L. Klein & G. Wirnsberger (nominated by Dr. JC Zungia-Pfluker), and Dr. E. M. Shevach.