Programmed death-1 (PD-1) is a recently identified coinhibitory molecule that belongs to the CD28 superfamily. PD-1 has two ligands PD-L1 and PD-L2. There is some evidence that PD-L1 and PD-L2 serve distinct functions, but their exact function in alloimmunity remains unclear. In the present study, we used a GVHD-like model that allows detailed analyses of T-cell activation at a single cell level in vivo to examine the role of PD-1/PD-L1 and PD-1/PD-L2 interactions in regulating proliferation of CD4(+) and CD8(+) T cells in response to alloantigen stimulation. We found that both CD4(+) and CD8(+) T cells proliferated vigorously in vivo and that PD-L1 and PD-L2 exhibit strikingly different effect on T-cell proliferation. While blocking PD-L1 did not affect the in vivo proliferation of CD4(+) and CD8(+) T cells regardless of CD28 costimulation, blocking PD-L2 resulted in a marked increase in the responder frequency of CD8(+) T-cells in vivo. The effect of PD-L2 on the CD8(+) T-cell proliferation is regulated by CD28 costimulation and by the CD4(+) T cells. We conclude that PD-L1 and PD-L2 function differently in regulating alloreactive T-cell activation in vivo, and PD-L2 is predominant in this model in limiting alloreactive CD8(+) T-cell proliferation.