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Accumulating data suggest that hepatic tolerance, initially demonstrated by spontaneous acceptance of liver allografts in many species, results from an immune regulatory activity occurring in the liver. However, the responsible cellular and molecular components have not been completely understood. We have recently described profound T cell inhibitory activity of hepatic stellate cells (HSCs) in vitro. In this study, we demonstrate in vivo evidence of immune modulatory activity of HSCs in mice using an islet transplantation model. Cotransplanted HSCs effectively protected islet allografts from rejection, forming a multilayered capsule, which reduced allograft immunocyte infiltrates by enhancement of apoptotic death. The immune modulation by HSCs appeared to be a local effect, and regulated by inducible expression of B7-H1, an inhibitory molecule of B7 family. This may reflect an intrinsic mechanism of immune inhibition mediated by liver-derived tissue cells. H epatic tolerance was initially recognized by spontaneous acceptance of liver allografts in a number of species. 1-4 Our laboratory focused on the mechanistic insights into liver transplant tolerance in mice and demonstrated that it is not attributable to a deletion of T cell clones specific to donor antigens, because lymphocytes isolated from tolerant mice respond well to donor antigen stimulation in vitro. 5 Whereas histological findings are notable for an abundance of CD4 and CD8 T cell infiltrates during the first week after transplantation, they are rapidly diminished via apoptotic death. [6][7][8] Similarly, in a nontransplant model, after injection of a specific antigenic peptide into TCR transgenic mice, deletion of specific CD8 ϩ T cells from the periphery was observed, as they accumulated in the liver and underwent subsequent apoptosis. 9 Combined, these results suggest a regulatory mechanism residing in the liver that may be responsible for its immune modulation. 10 However, the cellular components of the liver responsible for this are not completely understood.We have recently demonstrated that activated hepatic stellate cells (HSCs) effectively inhibit T cell responses in vitro, which is mediated by induction of T cell apoptosis. 11 Thus, subsequently studying whether HSCs can exert immune regulatory activities in vivo is logical. However, it is difficult to obtain direct evidence in the liver because approaches to specifically inhibit the effect of HSCs have not been defined. In this study, we used an islet allograft transplant model and demonstrated that cotransplantation with HSCs effectively protected islet allografts from rejection by forming a multi-layered immune barrier around the islets and reducing infiltrating T cells. Interestingly, HSCs isolated from B7-H1 knockout (KO) mice lost the protective effect on co-transplanted islet

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