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Interleukin-2 is central to the induction and maintenance of both natural (nT_reg) and induced Foxp3-expressing regulatory T cells (iT_reg). Thus, signals that modulate IL-2 availability may, in turn, also influence T_reg homeostasis. Using global knockout and cell-specific knockout mouse models, we evaluated the role of the small GTPase ADP-ribosylation factor 4d (Arl4d) in regulatory T-cell biology. We show that the expression of Arl4d in T cells restricts both IL-2 production and responsiveness to IL-2, as measured by the phosphorylation of STAT5. <i>Arl4d</i>-deficient CD4 T cells converted more efficiently into Foxp3⁺ iT_reg in vitro in the presence of αCD3ε and TGFβ, which was associated with their enhanced IL-2 secretion. As such, <i>Arl4d</i>^−/− CD4 T cells induced significantly less colonic inflammation and lymphocytic infiltration in a model of transfer colitis. Thus, our data reveal a negative regulatory role for Arl4d in CD4 T-cell biology, limiting iT_reg conversion via the restriction of IL-2 production, leading to reduced induction of T_reg from conventional CD4 T cells.