Th17 cells are implicated in host defence and autoimmune diseases. CD28/B7 co-stimulation is involved in the induction and progression of autoimmune diseases, but its role in controlling murine Th17 cell fate remains to be clarified. We here report that soluble anti-CD28 mAb suppressed the differentiation of anti-CD3-stimulated naïve CD4⁺ T cells into IL-17-producing cells. CD28 co-stimulation reduced the frequency of proliferating cells that produce IL-17. We provide evidence for an IL-2 and IFN-γ-dependent mechanism of CD28-mediated IL-17 suppression. CD28 blockade of Th17 development was correlated with a decrease rather than an increase in the percentage of Foxp3⁺ T cells. In APC/T cell co-cultures, mature dendritic cells (DC) were less efficient than immature DC in their ability to support Th17 cell differentiation, while CTLA4-Ig, an agent blocking CD28/B7 and CTLA4/B7 interactions, facilitated both murine and human Th17 differentiation. This study identifies the importance of B7 co-stimulatory molecules in the negative regulation of Th17 development. These unexpected results caution targeting the CD28/B7 pathways in the treatment of human autoimmune diseases.