The abundance of CD4+ CD25+ regulatory T cells in umbilical cord blood (UCB) might contribute to the decreased severity of graft-vs.-host disease (GVHD) for UCB transplantation. This study aims to characterize the phenotypes and suppressive function of UCB CD4+ CD25+ T cells under the influence of anti-CD3/anti-CD28 (CD3/CD28) and exogenous interleukin (IL)-2 or IL-15. Higher percentages of CD4+ CD25high and FoxP3+ cells were detected in UCB compared to their adult counterparts. IL-15 was as effective as IL-2 in enhancing the proliferation of CD3/CD28 stimulated UCB CD4+ CD25+ T cells. Phenotypically, IL-2/IL-15-stimulated UCB CD4+ CD25+ T cells expressed higher level of CTLA-4, GITR, membrane bound transforming growth factor-β (mTGF-β), and especially Foxp-3 than controls. IL-2/IL-15-stimulated UCB CD4+ CD25+ T cells also produced much higher IL-10 and TGF-β than controls; while IL-2/IL-15-stimulated UCB CD4+ CD25− T cells showed increased TGF-β, but not IL-10 production. IL-2/IL-15-cultured UCB CD4+ CD25+ T cells showed comparable suppressor activity on allogeneic adult CD4+ T-cell proliferation compared to controls, partly through a contact-dependent fashion. Taken together, IL-2/IL-15-stimulated UCB CD4+ CD25+ T cells show distinct regulatory T-cell phenotypic and functional features, and may be applied for the alleviation of GVHD severity following UCB transplantation.