Fibrocytes are collagen-type-I-producing cells that arise at low frequency from hematopoietic cells. We have analyzed in mice which leukocyte subsets are required for generation of fibrocytes and show that murine fibrocytes develop from the subpopulation of CD11b(+) CD115(+) Gr1(+) monocytes under the control of CD4(+) T cells. In the absence of CD4(+) T cells, differentiation of fibrocytes was markedly reduced in vitro and in vivo. In the presence of CD4(+) T cells, the characteristics of T-cell activation critically determined development of fibrocytes. Polyclonal activation of CD4(+) T cells induced the release of soluble factors that completely prevented the outgrowth of fibrocytes and could be identified as IL-2, TNF, IFN-gamma, and IL-4. Application of IL-2 and TNF significantly reduced the appearance of fibrocytes and the severity of fibrosis in the model of unilateral ureteral obstruction. In contrast, activation of CD4(+) T cells in the presence of calcineurin inhibitors, but not mTOR inhibitors, markedly enhanced the outgrowth of fibrocytes and renal deposition of collagen I. Taken together, we show that differentiation of fibrocytes is critically dependent on CD4(+) T cells and that the context of T-cell activation determines whether development of fibrocytes is supported or blocked. Our data may have implications for prevention of organ fibrosis in autoimmune diseases and transplantation.