Fas ligand (CD95L) inhibits T cell function in immune-privileged organs such as the eye and testis, yet in most tissues CD95L expression induces potent inflammatory responses. With a stably transfected colon carcinoma cell Line, CT26-CD95L, the molecular basis for these divergent responses was defined. When injected subcutaneously, rejection of CT26-CD95L was caused by neutrophils activated by CD95L. CT26-CD95L survived in the intraocular space because of the presence of transforming growth factor-beta (TGF-beta), which inhibited neutrophil activation. Providing TGF-beta to subcutaneous sites protected against tumor rejection. Thus, these cytokines together generate a microenvironment that promotes immunologic tolerance, which may aid in the amelioration of allograft rejection.