FasL as an immunomodulatory approach to induce tolerance. APCs genetically modified to express FasL or “decorated” with exogenous FasL are injected into hosts with autoimmunity or allograft recipients to eliminate pathogenic, activated T cells by sheer physical close proximity (A) or antigen-mediated interaction (B). This approach has the potential to eliminate a significant repertoire of antigen-specific T cells, and as such generate systemic tolerance. Tolerance may be the end result of physical elimination of antigen-specific T cells and/or induction and expansion of T cells with regulatory functions. (C) Localized immunomodulation with FasL expressed in the target tissues. (D) Localized immunomodulation induced by cotransplantation of APCs expressing FasL with target tissues. The anticipation is that FasL in panels C-D will generate an immune-privileged site that provides the first line of defense and confers protection by keeping pathogenic T cells in check until long-lasting protective immunoregulatory mechanisms are activated. This approach is particularly attractive in transplant settings that allow the manipulation of donor graft, rather than the recipient for tolerance induction, and as such may be associated with minimal adverse side effects in the host compared with host systemic manipulation.