Abstract Human CD34+ fibrocytes, circulating monocyte lineage progenitor cells, have recently been implicated in thyroid-associated ophthalmopathy (TAO), the ocular manifestation of Graves’ disease (GD). Fibrocytes express constitutive MHC class II (MHC-2) and, surprisingly, thyroglobulin (Tg) and functional thyrotropin (TSH) receptor (TSHR). Underlying expression of these thyroid proteins is the autoimmune regulator protein (AIRE). Fibrocytes respond robustly to TSH and thyroid-stimulating Igs by generating extremely high levels of inflammatory cytokines, such as IL-6. In TAO, they appear to infiltrate the orbit, where they transition to CD34+ orbital fibroblasts (OF). There, they coexist with CD34− OF as a mixed fibroblast population (GD-OF). In contrast to fibrocytes, GD-OF express vanishingly low levels of MHC-2, Tg, TSHR, and AIRE. Further, the amplitude of IL-6 induction by TSH in GD-OF is substantially lower. The molecular basis for this divergence between fibrocytes and CD34+ OF remains uncertain. In this article, we report that Slit2, an axon guidance glycoprotein, is constitutively expressed by the CD34− OF subset of GD-OF. Culture conditioned medium (CM) generated by incubating with GD-OF and CD34− OF substantially reduces levels of MHC-2, Tg, TSHR, and AIRE in fibrocytes. Expression can be restored by specifically depleting CM of Slit2. The effects of CD34− OF CM are mimicked by recombinant human Slit2. TSH induces Slit2 levels in GD-OF by enhancing both Slit2 gene transcription and mRNA stability. These findings suggest that Slit2 represents a TSH-inducible factor within the TAO orbit that can modulate the inflammatory phenotype of CD34+ OF and therefore may determine the activity and severity of the disease.