A subpopulation of T cells, named regulatory T cells (Treg cells), has been shown to play a key role in tolerance and the prevention of autoimmunity. It is not known how changes in TCR signal strength during thymic T cell development affect the generation of a Treg population. In this study, we took two different strategies to modulate the TCR signal strength: an intrinsic approach, where signaling was enhanced by the loss of a negative regulator, and an extrinsic approach, where signaling strength was altered through variations in the concentrations of the selecting peptide. The tyrosine phosphatase Src homology region 2 domain-containing phosphatase 1 (SHP-1) is a known negative regulator of TCR-mediated signaling. motheaten mice, lacking expression of SHP-1, showed a 2- to 3-fold increase in the percentage of CD4+CD25+ Treg cells within the CD4+ T cells. Similarly, the percentage of Treg cells was heightened in fetal thymic organ cultures (FTOCs) derived from motheaten mice compared with wild-type FTOCs, thus establishing the thymic origin of these Treg cells. Using FTOCs derived from DO11.10 TCR transgenic mice, we demonstrated that exposure to increasing concentrations of the cognate OVA peptide favored the appearance of Treg cells. Our data suggest that the development of CD4+CD25+ Treg cells is intrinsically different from non-Treg cells and that Treg cells are selectively enriched under conditions of enhanced negative selection. Our data also reveal a key role for the SHP-1-mediated regulation of TCR signal strength in influencing the ratio of Treg vs non-Treg cells.