Chronic inflammatory demyelinating polyneuropathy results from autoimmune destruction of the peripheral nervous system and is a component of the multiorgan autoimmunity syndrome that results from Aire gene mutations in humans. In parallel, peripheral nervous system autoimmunity resembling chronic inflammatory demyelinating polyneuropathy develops spontaneously in NOD mice with a partial loss of Aire function (NOD.Aire(GW/+) mice) and is a T cell-mediated disease. In this study, we analyze how key aspects of T cell activation and function modulate disease development in Aire-deficient mice. We show that genetic ablation of the Th1 cytokine IFN-γ completely prevents clinical and electrophysiological evidence of neuropathy in NOD.Aire(GW/+) mice. IFN-γ deficiency is associated with absence of immune infiltration and decreased expression of the T cell chemoattractant IP-10 in sciatic nerves. Thus, IFN-γ is absolutely required for the development of autoimmune peripheral neuropathy in NOD.Aire(GW/+) mice. Because IFN-γ secretion is enhanced by B7-CD28 costimulation of T cells, we sought to determine the effects of these costimulatory molecules on neuropathy development. Surprisingly, B7-2 deficiency accelerated neuropathy development in NOD.Aire(GW/+) mice, and Ab blockade of both B7-1 and B7-2 resulted in fulminant, early-onset neuropathy. Thus, in contrast to IFN-γ, B7-2 alone and B7-1/B7-2 in combination function to ameliorate neuropathy development in NOD.Aire(GW/+) mice. Together, these findings reveal distinct and opposing effects of the T cell costimulatory pathway and IFN-γ production on the pathogenesis of autoimmune peripheral neuropathy.