Immunosuppression by UV light contributes significantly to the induction of skin cancer by suppressing the cell-mediated immune responses which control the development of carcinogenesis. The B7/CD28-CTLA-4 signaling pathway provides costimulatory signals essential for Ag-specific T cell activation. To investigate the role of this pathway in photocarcinogenesis, we utilized transgenic (Tg) mice which constitutively express CTLA-4Ig, a high-affinity CD28/CTLA-4 antagonist that binds to both B7-1 and B7-2. The transgene is driven by a skin-specific promoter yielding high levels of CTLA-4Ig in the skin and serum. Chronic UV exposure of CTLA-4Ig Tg mice resulted in significantly reduced numbers of skin tumors, when compared to control mice. In addition, Tg mice were resistant to UV-induced suppression of delayed-type hypersensitivity responses to alloantigens. Most importantly, upon stimulation with mitogens and alloantigens, T cells isolated from CTLA-4Ig Tg mice produced significantly less IL-4 but more IFN-gamma compared to control T cells, suggesting an impaired Th2 response and a relative increase of Th1-type immunity. Together, these data show that overall B7 engagement directs immune responses toward the Th2 pathway. Moreover, they point out the crucial role of Th1 immune reactions in the protection against photocarcinogenesis.