Sera from mice with transplanted 3-methylcholantrene-induced tumors have been shown previously to inhibit the function of normal lymphoid cells. When chromatographed on Sephadex G-150, the fraction eluting with immunoglobulin has been shown to inhibit the proliferative response of normal spleen cells to concanavalin A and to inhibit the in vitro antibody response to a T-dependent antigen, but has a lesser effect on the antibody response to a T-independent antigen. This paper deals with studies on the mode of action of the serum factor. The immunoglobulin containing fraction of serum from tumor-bearing mice inhibited the in vitro generation of both allogeneic and syngeneic cytotoxic lymphocytes. Time course studies demonstrate that the serum fraction inhibits the generation of antibody-producing and cytotoxic lymphocytes if added during the first 2 days of a 5-day culture. Serum fractions added after day 2 had no effect on the in vitro response. The serum factor appears to inhibit the generation of specific T cell function during the proliferative stage of development but has no effect on the differentiation stage which leads to either antibody-producing cells or cytotoxic lymphocytes.