We have recently established a unique model system of nonmyeloablative allogeneic stem cell transplantation (SCT) for treatment of murine solid tumors, based on cyclophosphamide-induced tolerance. An injection of allogeneic donor spleen cells and bone marrow cells (BMC) followed by cyclophosphamide treatment induced a stable mixed chimerism with long lasting tolerance to the allografts. A donor lymphocyte infusion (DLI) in the cyclophosphamide-induced tolerant mice exerted strong anti-tumor effects on an MBT-2 murine bladder tumor, MBT-2 via their graft versus tumor (GVT) activity. In the present study, we determined whether a cyclophosphamide-induced reduction of naturally occurring regulatory T cells (Tregs) was associated with the anti-tumor activity in our nonmyeloablative SCT system. The number of recipient CD4+ CD25+ Foxp3+ Tregs significantly decreased 3 days after an intraperitoneal injection of cyclophosphamide in C3H/HeN mice that had been injected with spleen cells and BMC of donor AKR/J mice, compared with the number of CD4+ CD25+ Foxp3- T cells. An adoptive transfer of CD4+ CD25+ T cells from naïve C3H/He x AKR/J F1 mice into recipient mice 1 day after DLI significantly suppressed the expansion and IFN-γ production of host-reactive donor CD4+T cells and hampered the MBT-2 anti-tumor activity when compared with the transfer of CD4+ CD25- T cells. These results indicated that cyclophosphamide-induced reduction of recipient Tregs is associated with retardation of tumor progression via the expansion of host-reactive donor T cells and IFN-γ production after DLI in our nonmyeloablative SCT system.