Regulatory T (Treg) cells suppress autoimmune disease, and impaired Treg cell function is associated with rheumatoid arthritis. Here we demonstrate that forkhead box P3 (FOXP3) transcriptional activity and, consequently, Treg cell suppressive function are regulated by phosphorylation at Ser418 in the C-terminal DNA-binding domain. In rheumatoid arthritis-derived Treg cells, the Ser418 site was specifically dephosphorylated by protein phosphatase 1 (PP1), whose expression and enzymatic activity were induced in the inflamed synovium by tumor necrosis factor α (TNF-α), leading to impaired Treg cell function. Moreover, TNF-α-induced Treg cell dysfunction correlated with increased numbers of interleukin-17 (IL-17)(+) and interferon-γ (IFN-γ)(+)CD4(+) T cells within the inflamed synovium in rheumatoid arthritis. Treatment with a TNF-α-specific antibody restored Treg cell function in subjects with rheumatoid arthritis, which was associated with decreased PP1 expression and increased FOXP3 phosphorylation in Treg cells. Thus, TNF-α controls the balance between Treg cells and pathogenic TH17 and TH1 cells in the synovium of individuals with rheumatoid arthritis through FOXP3 dephosphorylation.

T cell activation and function are critically regulated by positive and negative costimulatory molecules. Aberrant expression and function of costimulatory molecules have been associated with persistent activation of self-reactive T cells in autoimmune diseases such as rheumatoid arthritis (RA). In this study, initial analysis of costimulatory molecules led to the unexpected observation that, in addition to CD80, several negative regulators (e.g., CTLA-4, programmed death-1 (PD-1), and PD ligand-1) were overexpressed in synovial T cells and macrophages derived from RA patients as opposed to controls. The expression of CD80 and PD ligand-1 on monocytes could be induced in vitro by IFN-γ and TNF-α that were produced abundantly in RA-derived synovial fluid (SF). Furthermore, the soluble form of negative costimulatory molecules occurred at high concentrations in sera and SF of RA patients and correlated with titers of rheumatoid factor in RA patients. In particular, the levels of soluble PD-1 were found to correlate significantly with those of TNF-α in SF derived from RA patients. Detailed characterization of soluble PD-1 revealed that it corresponded to an alternative splice variant (PD-1Δex3) and could functionally block the regulatory effect of membrane-bound PD-1 on T cell activation. Our data indicate a novel pathogenic pathway in which overexpression of negative costimulatory molecules to restrict synovial inflammation in RA is overruled by the excessive production of soluble costimulatory molecules.