The Jak, Tyk2, is activated in response to IL-12 and IFN-alphabeta and promotes IFN-gamma production by Th1-type CD4 cells. Mice deficient in Tyk2 function have been previously shown to be resistant to autoimmune arthritis and septic shock but are acutely susceptible to opportunistic pathogens such as Toxoplasma gondii. In this study, we show that Tyk2, in addition to mediating the biological effects of IL-12 and IFN-alphabeta, is an important regulator for the signaling and expression of the immunosuppressive cytokine IL-10. In the absence of Tyk2, Ag-reactive CD4 cells exhibit impaired IL-10 synthesis following rechallenge of T. gondii vaccine-primed mice. The impaired IL-10 reactivation leads to unopposed antimicrobial effector mechanisms which results in a paradoxically superior protection of immune Tyk2(-/-) mice against virulent T. gondii challenge. We further demonstrate that Tyk2 indirectly controls CD4 IL-10 reactivation by signaling for maximal IFN-gamma secretion. The unexpected role of IFN-gamma in mediating IL-10 reactivation by Th1 cells provides compelling evidence that conditions driving Th1 responses establish a negative feedback loop, which will ultimately lead to its autoregulation. Thus, Tyk2 can be viewed as a dual-function Jak, mediating both pro and anti-inflammatory cytokine responses.