Resting epidermal keratinocytes do not express B7-1 and other known CD28 counterligands with costimulatory activity. The absence of these costimulators on keratinocytes correlates with their ability to preferentially induce T-cell anergy instead of T-cell activation. To test the hypothesis that keratinocytes expressing a CD28 counterligand would be more effective inducers of T-cell-mediated immune responses in skin, we prepared transgenic mice in which expression of the B7-1 costimulator was targeted to basal keratinocytes by using the human K14 promoter. Keratinocytes from the K14/B7-1 transgenic line expressed high levels of surface B7-1. No spontaneous inflammatory changes were seen in transgenic skin, but epicutaneous application of contact sensitizers to these mice elicited a stronger primary ear swelling response than in controls. Sites of initial hapten application in transgenic mice also responded much more strongly to reapplication of hapten to a remote cutaneous site. Epidermal cell suspensions from transgenic mice contained normal numbers of Langerhans cells and dendritic epidermal T cells when analyzed by flow cytometry. Systemic treatment of the transgenic mice with interferon gamma induced high levels of class II major histocompatibility complex expression on keratinocytes but was not sufficient to initiate an inflammatory response. We conclude that the constitutive expression of the B7-1 molecule in vivo on a nonprofessional antigen-presenting cell is not by itself sufficient to trigger inflammatory changes, but B7-1 expression amplifies the host immune responses after exposure to nonself antigens presented by B7-1-expressing cells.