Chronic transplant dysfunction, a major impediment to long-term allograft survival, is caused by several factors including an ongoing alloimmune response termed chronic rejection. To define some of these factors further, we selected 107 patients mismatched to their donors from 623 patients transplanted at a single center. Patients were categorized according to their immunosuppressive treatment and further divided into those with stable or chronic allograft dysfunction. Donor human lymphocyte antigen allopeptide-specific T-cell lines were then generated from stable patients and those with biopsy-proven chronic allograft nephropathy. Increased amounts of CD4+CD25+ regulatory T cells (Tregs) and Treg-associated gene expression profiles were found in cell lines derived from the patients with stable compared with those with chronic allograft dysfunction. Furthermore, a higher percentage of Tregs was found in patients with stable graft function on tacrolimus-based compared with cyclosporine-based immunosuppression protocols. Patients with stable graft function had a significantly higher expression of interleukin (IL)-4 and IL-10, whereas the cytokines IL-2, IL-17, and interferon-γ were significantly higher in patients with allograft dysfunction in vitro. Thus, enhancing the operational role of naturally occurring donor-specific Tregs in allograft recipients by adjusting the immunosuppression protocol may be advantageous particularly for patients with ongoing chronic rejection.