Programmed death-1 ligand (PD-L)1 and PD-L2 are ligands for programmed death-1 (PD-1), a member of the CD28/CTLA4 family expressed on activated lymphoid cells. PD-1 contains an immunoreceptor tyrosine-based inhibitory motif and mice deficient in PD-1 develop autoimmune disorders suggesting a defect in peripheral tolerance. Human PD-L1 and PD-L2 are expressed on immature dendritic cells (iDC) and mature dendritic cells (mDC), IFN-gamma-treated monocytes, and follicular dendritic cells. Using mAbs, we show that blockade of PD-L2 on dendritic cells results in enhanced T cell proliferation and cytokine production, including that of IFN-gamma and IL-10, while blockade of PD-L1 results in similar, more modest, effects. Blockade of both PD-L1 and PD-L2 showed an additive effect. Both whole mAb and Fab enhanced T cell activation, showing that PD-L1 and PD-L2 function to inhibit T cell activation. Enhancement of T cell activation was most pronounced with weak APC, such as iDCs and IL-10-pretreated mDCs, and less pronounced with strong APC such as mDCs. These data are consistent with the hypothesis that iDC have a balance of stimulatory vs inhibitory molecules that favors inhibition, and indicate that PD-L1 and PD-L2 contribute to the poor stimulatory capacity of iDC. PD-L1 expression differs from PD-L2 in that PD-L1 is expressed on activated T cells, placental trophoblasts, myocardial endothelium, and cortical thymic epithelial cells. In contrast, PD-L2 is expressed on placental endothelium and medullary thymic epithelial cells. PD-L1 is also highly expressed on most carcinomas but minimally expressed on adjacent normal tissue suggesting a role in attenuating antitumor immune responses.