Mesenchymal stem cells (MSCs) are emerging as a promising immunotherapeutic, 
based largely on their overt suppression of T lymphocytes under inflammatory and 
autoimmune conditions. While paracrine cross-talk between MSCs and T cells has 
been well-studied, an intrinsic transcriptional switch that programs MSCs for 
immunomodulation has remained undefined. Here we show that bone marrow-derived 
MSCs require the transcriptional regulator Aire to suppress T cell-mediated 
pathogenesis in a mouse model of chronic colitis. Surprisingly, Aire did not 
control MSC suppression of T cell proliferation in vitro. Instead, Aire reduced 
T cell mitochondrial reductase by negatively regulating a proinflammatory 
cytokine, early T cell activation factor (Eta)-1. Neutralization of Eta-1 
enabled Aire(-/-) MSCs to ameliorate colitis, reducing the number of 
infiltrating effector T cells in the colon, and normalizing T cell reductase 
levels. We propose that Aire represents an early molecular switch imposing a 
suppressive MSC phenotype via regulation of Eta-1. Monitoring Aire expression in 
MSCs may thus be a critical parameter for clinical use.