Regulatory T cells exert a critical role in controlling autoimmunity and maintaining peripheral tolerance. The best described regulatory T cells are the naturally occurring CD4+CD25+ regulatory T cells, which have been shown to be continuously produced within the thymus. Other T-cell subsets bearing suppressive capacity have been reported, including T-helper-3 cells (Th3) and type 1 regulatory T (Tr1) cells. Tr1 cells have been shown to be induced upon antigen exposure under certain tolerogenic conditions and are characterized by the production of the immunosuppressive cytokines IL-10 and TGF-beta, while Th3 cells preferentially produce TGF-beta upon induction by intestinal tolerance. Recent progress has been made in the characterization of Tr1 cells in terms of isolation and induction, respectively. The present review provides an overview of the presence of Tr1 cells in inflammation, infection and neoplastic disorders. Moreover, the relationship between different regulatory T cell subsets and their transcriptional control is discussed. The recent development of methods allowing the ex vivo expansion of regulatory T cells may be the first step towards a cellular therapy with regulatory T cells to control T-cell-mediated pathology in inflammatory disorders.