Interleukin (IL)-10 is a key immunoregulatory cytokine that functions to prevent inflammatory and autoimmune diseases. Despite the critical role for IL-10 produced by effector CD8(+) T cells during pathogen infection and autoimmunity, the mechanisms regulating its production are poorly understood. We show that loss of the Inhibitor of DNA binding (Id) 2 in T cells resulted in aberrant IL-10 expression in vitro and in vivo during influenza virus infection and in a model of acute graft vs. host disease (GVHD). Furthermore, IL-10 over-production substantially reduced the immunopathology associated with GVHD. We demonstrate that Id2 acts to repress the E2A-mediated trans-activation of the Il10 locus. Collectively, our findings uncover a key regulatory role of Id2 during effector T cell differentiation necessary to limit IL-10 production by activated T cells and minimize their suppressive activity during the effector phase of disease control.