Regulatory T cells (Tregs) are critical for maintaining self-tolerance and homeostasis, and have potential application in clinical disease therapy, such as autoimmune diseases and transplant rejection, but their numbers are limited. FOXP3 is a key transcription factor controlling Tregs development and function. Although transfection of CD4+CD25− lymphocytes with the FOXP3 gene can convert them to Treg-like cells, there is the risk of insertional mutagenesis and thus an alternative to genetic intervention is sought. The protein transduction domain (PTD) from the HIV transactivator of transcription is a useful tool to deliver protein to the cytoplasm and nucleus. In this study, we generated a fusion protein linking the human FOXP3 to PTD (PTD-hFOXP3), and explored its function in T cells. The results showed that the PTD rapidly and effectively delivered the hFOXP3 protein into cells where it localized not only in the cytoplasm, but also to the nucleus. PTD-hFOXP3-transduced Jurkat cells (human T lymphoma cell line) and CD4+CD25− T cells failed to proliferate and produce IL-2 and IFN-γ, but produced large amounts of the cytokines IL-4, IL-10, and TGF-β, in response to TCR stimulation in vitro. PTD-hFOXP3-transduced CD4+CD25− T cells also expressed high levels of CTLA-4 and low levels of CD25 after stimulation. Most importantly, PTD-hFOXP3-transduced T cells inhibited the proliferation of activated CD4+CD25− T cells. Furthermore, chromatin immunoprecipitation assays demonstrated that PTD-hFOXP3 can bind with the IL-2 gene promoter and repress the expression of IL-2. These results indicate that PTD-hFOXP3 has the capability to convert conventional T cells to Treg-like cells. J. Cell. Biochem. 113: 3797–3809, 2012. © 2012 Wiley Periodicals, Inc.