The aim of this work was to decipher how graft-versus-host disease (GVHD) affects T cell production and homeostasis. In GVHD⁺ mice, thymic output was decreased fourfold relative to normal mice, but was sufficient to maintain a T cell repertoire with normal diversity in terms of Vβ usage. Lymphoid hypoplasia in GVHD⁺ mice was caused mainly by a lessened expansion of the peripheral postthymic T cell compartment. In 5-bromo-2′-deoxyuridine pulse-chase experiments, resident T cells in the spleen of GVHD⁺ mice showed a normal turnover rate (proliferation and half-life). When transferred into thymectomized GVHD⁻ secondary hosts, T cells from GVHD⁺ mice expanded normally. In contrast, normal T cells failed to expand when injected into GVHD⁺ mice. Thus, the reduced size of the postthymic compartment in GVHD⁺ mice was not due to an intrinsic lymphocyte defect, but to an extrinsic microenvironment abnormality. We suggest that this extrinsic anomaly is consistent with a reduced number of functional peripheral T cell niches. Therefore, our results show that GVHD-associated T cell hypoplasia is largely caused by a perturbed homeostasis of the peripheral compartment. Furthermore, they suggest that damage to the microenvironment of secondary lymphoid organs may represent an heretofore unrecognized cause of acquired T cell hypoplasia.