Abstract Immune homeostasis in peripheral tissues is achieved by maintaining a balance between pathogenic effector T cells (Teffs) and protective Foxp3+ regulatory T cells (Tregs). Using a mouse model of an inducible tissue Ag, we demonstrate that Ag persistence is a major determinant of the relative frequencies of Teffs and Tregs. Encounter of transferred naive CD4+ T cells with transiently expressed tissue Ag leads to generation of cytokine-producing Teffs and peripheral Tregs. Persistent expression of Ag, a mimic of self-antigen, leads to functional inactivation and loss of the Teffs with preservation of Tregs in the target tissue. The inactivation of Teffs by persistent Ag is associated with reduced ERK phosphorylation, whereas Tregs show less reduction in ERK phosphorylation and are relatively resistant to ERK inhibition. Our studies reveal a crucial role for Ag in maintaining appropriate ratios of Ag-specific Teffs to Tregs in tissues.