Orally administered antigens induce a state of immunologic hyporesponsiveness termed oral tolerance. Different mechanisms are involved in mediating oral tolerance depending on the dose fed. Low doses of antigen generate cytokine-secreting regulatory cells, whereas high doses induce anergy or deletion. We used mice transgenic for a T-cell receptor (TCR) derived from an encephalitogenic T-cell clone specific for the acetylated N-terminal peptide of myelin basic protein (MBP) Ac-1-11 plus I-Au to test whether a regulatory T cell could be generated from the same precursor cell as that of an encephalitogenic Th1 cell and whether the induction was dose dependent. The MBP TCR transgenic mice primarily have T cells of a precursor phenotype that produce interleukin 2 (IL-2) with little interferon gamma (IFN-gamma), IL-4, or transforming growth factor beta (TGF-beta). We fed transgenic animals a low-dose (1 mg x 5) or high-dose (25 mg x 1) regimen of mouse MBP and without further immunization spleen cells were tested for cytokine production. Low-dose feeding induced prominent secretion of IL-4, IL-10, and TGF-beta, whereas minimal secretion of these cytokines was observed with high-dose feeding. Little or no change was seen in proliferation or IL-2/IFN-gamma secretion in fed animals irrespective of the dose. To demonstrate in vivo functional activity of the cytokine-secreting cells generated by oral antigen, spleen cells from low-dose-fed animals were adoptively transferred into naive (PLJ x SJL)F1 mice that were then immunized for the development of experimental autoimmune encephalomyelitis (EAE). Marked suppression of EAE was observed when T cells were transferred from MBP-fed transgenic animals but not from animals that were not fed. In contrast to oral tolerization, s.c. immunization of transgenic animals with MBP in complete Freund's adjuvant induced IFN-gamma-secreting Th1 cells in vitro and experimental encephalomyelitis in vivo. Despite the large number of cells reactive to MBP in the transgenic animals, EAE was also suppressed by low-dose feeding of MBP prior to immunization. These results demonstrate that MBP-specific T cells can differentiate in vivo into encephalitogenic or regulatory T cells depending upon the context by which they are exposed to antigen.