Background. Prevention of alloreactivity by rabbit anti-thymocyte globulins (rATG) may not only result from immunodepletion but also from the induction of T cells that control allogeneic immune responses. In the present prospective and controlled study, we investigated the effect of rATG on the frequency, function and phenotype of peripheral immunoregulatory CD4+ T cells in kidney transplant (KTx) patients. Methods. After transplantation, 16 patients received ATG-induction therapy and triple therapy consisting of tacrolimus, MMF and steroids. The control group (n = 18) received triple therapy only. By flow cytometry, T cells were analysed for CD25, FoxP3, CD127, CD45RO and CCR7. To study their suppressive capacities, CD25bright T cells were co-cultured with CD25−/dim effector T cells (Teff) in mixed lymphocyte reactions (MLR), stimulated with donor and third party (3P) antigens. Results. Pre-transplant levels of FoxP3+CD127−/low T cells were 6% of CD4+ T cells. One week post-ATG treatment, no measurable numbers of regulatory T cells were present (P < 0.01). After 4 weeks, the cell numbers of CD4+FoxP3+CD127−/low T cells slowly reappeared and thereafter remained low (P < 0.01). At 14 weeks, a significant shift towards the CD45RO+CCR7+ (central memory) phenotype within CD4+FoxP3+ T cells was observed (P < 0.01). At 26 weeks, the proliferative alloresponses of the PBMC and CD25−/dim Teff profoundly decreased compared to pre-transplant (P = 0.01 and P = 0.02 respectively), while the regulatory capacity of the CD25bright T cells, of which 90% consisted of FoxP3+CD127−/low T cells, remained unaffected. The CD25bright T cells suppressed the anti-donor (94%) and 3P responses (93%). Conclusion. Our findings show that rATG therapy does not spare peripheral immunoregulatory T cells in vivo, but after regeneration preserves their suppressive activity.