In patients receiving allogeneic hematopoietic cell transplantation, chronic graft-versus-host disease (cGVHD) remains a frequent complication and resembles autoimmune diseases such as systemic lupus erythematosus and systemic sclerosis. Our previous work demonstrated the critical role of CD28 costimulation of donor T cells for GVHD induction. In this study, we investigate the role of CD28 costimulation of host T cells in cGVHD. CD28-intact mice as hosts showed systemic lupus erythematosus–type cGVHD, whereas CD28-deficient mice developed a distinct phenotype of cGVHD, with fibrotic damage in skin and internal organs, resembling systemic sclerosis. This phenotype was due to a lack of signaling through the C-terminal proline-rich motif within host CD28’s cytoplasmic tail, a motif previously shown to be required for development of regulatory T cells (Tregs) and function of conventional T cells. Adoptive transfer experiments demonstrated that a defect in host CD4+CD25+ Tregs, but not in conventional T cells, was responsible for disease phenotype. Host Treg deficiency altered the cytokine pattern of donor CD4+ T cells and the Ag specificity of autoantibodies, and these might lead to phenotypic change. Thus, host CD28 signaling controlled the pathogenesis of cGVHD through effects on host Tregs, whose status impacts qualitatively on the allogeneic immune responses.