Myasthenia gravis is a T cell-dependent, antibody-mediated autoimmune disease. A dual altered peptide ligand (APL) that is composed of the tandemly arranged two single amino acid analogs of two myasthenogenic peptides, p195–212 and p259–271, was demonstrated to down-regulate in vitro and in vivo myasthenia gravis-associated autoreactive responses. The aims of this study were to demonstrate the suppressive properties and to elucidate the mechanism of action of the dual APL on a T cell line specific to the myasthenogenic peptide p195–212. We demonstrate here that incubation of cells of the line with the dual APL resulted in the inhibition of proliferation and secretion of IL-2 and IFN-γ triggered by p195–212. In contrast, secretion of TGF-β and IL-10 was upregulated. The dual APL induced the generation of CD4+CD25+ cells that were characterized by the expression of CD45Rblow, cytotoxic T lymphocyte-associated antigen-4, TGF-β, CD62L, Foxp3, and neuropilin. In addition, the dual APL-treated cells were capable of inhibiting the proliferation response of the line when the two sets of cells were cocultured. The role of CD4+CD25+ cells was further confirmed by demonstrating that the suppression was abrogated by blocking/neutralization of CD25. Thus, the dual APL acts by inducing the formation of CD4+CD25+ regulatory cells. By using a T cell line, we could show that the immunosuppressive CD4+CD25+ cells were indeed induced by the dual APL and are not part of the naturally occurring regulatory cells