NK cells have two main functions, namely cell-mediated cytotoxicity and production of cytokines. Multiple inhibitory receptors that regulate NK-cell cytotoxicity have been characterized whereas little is known about receptors regulating cytokine production. Here we report that CD72, which is considered to be an important co-receptor regulating B-cell activation, is also expressed on mouse NK cells. NK cells expressing high levels of CD72, upon stimulation with IL-12 and IL-18 or target cells, produce significantly less IFN-gamma than those expressing low levels of CD72, whereas both subsets are equally cytotoxic. Ectopic expression of CD72 in the murine NK-cell line KY2 inhibits cytokine-induced IFN-gamma production, and the inhibitory effect is diminished by mutations in the inhibitory motifs in the intracellular domain or replacement of the extracellular domain of CD72. Thus, CD72 is an inhibitory receptor on NK cells regulating cytokine production.