Regulatory T cells and T helper 17 cells are two recently described lymphocyte subsets with opposing actions. In this review, we discuss the mechanisms that promote development of these cells from common precursors and the specific factors that impact their cell numbers and function. Altered regulation of this key developmental checkpoint may contribute to the pathophysiology of autoimmune diseases by tipping the balance toward inflammation. We also present recent findings that suggest how the equilibrium between regulatory T cells and proinflammatory T helper subsets might be pharmacologically restored for therapeutic benefit.