Regulatory T (Treg) cells are a subpopulation of T cells with the ability to control the responses of both CD4+ and CD8+ T cells. A case-control study was conducted in order to determine the functional attributes of Treg cells within the breast cancer milieu. Triple-color flow cytometry was utilized to study the phenotype expression of CD4+CD25+ Treg cells and CD8+ T cells in autologous tumor-infiltrating lymphocytes (TILs) and peripheral blood lymphocytes (PBLs) derived from 33 patients with stage I-III breast cancer. The prevalence of CD4+CD25+ T cells was significantly higher in TILs than in PBLs. The expressions of FOXP3 and GITR in CD4+CD25+ Treg cells were lower in PBLs than in TILs. Functional studies showed that both granzyme B and perforin were barely expressed in peripheral Treg cells but were highly expressed in Treg cells in the tumor microenvironment. On the contrary, down-regulation of both granzyme B and perforin expressed in the CD8+ cytotoxic T lymphocytes was significantly lower in TILs than in PBLs. Further functional assays demonstrated that Th1 cytokines and cytotoxic molecules were synchronously up-regulated in CD8+ cytotoxic T cells. The in vitro kinetic study showed that adequate activation of TILs derived from breast cancer tissue could restore the appropriate antitumor immune response.