IL-27 is secreted by APCs in response to inflammatory stimuli and exerts a proinflammatory Th1-enhancing activity but also has significant anti-inflammatory functions. We examined the molecular mechanism by which IL-27 regulates TGFbeta plus IL-6- or IL-23-dependent Th17 development in the mouse and human systems. IL-27 inhibited the production of IL-17A and IL-17F in naive T cells by suppressing, in a STAT1-dependent manner, the expression of the Th17-specific transcription factor RORgamma t. The in vivo significance of the role of IL-27 was addressed in delayed-type hypersensitivity response and experimental autoimmune encephalomyelitis (EAE). By generating mice deficient for the p28 subunit of IL-27, we showed that IL-27 regulated the severity of delayed-type hypersensitivity response and EAE through its effects on Th17 cells. Furthermore, up-regulation of IL-10 in the CNS, which usually occurs late after EAE onset and plays a role in the resolution of the disease, was notably absent in IL-27p28(-/-) mice. These results show that IL-27 acts as a negative regulator of the developing IL-17A response in vivo, suggesting a potential therapeutic role for IL-27 in autoimmune diseases.