Islet specific CD4 cells expressing inhibitory receptors may be a useful therapeutic tool for treating type 1 diabetes (T1D). Engagement of transgenic Ly49A inhibits CD4 cell activation and delays onset of T1D in mice. However, in vitro studies suggest the inhibitory effect of Ly49A is incomplete. Here we report that following simultaneous TCR and Ly49A engagement, phosphorylation of Zap70, Erk1/2 and c-Jun were significantly diminished. Kinetic studies indicated that Ly49A did not simply delay activation but had a long-lasting effect. In contrast, when only costimulatory signals were provided through CD28, Ly49A engagement did not block p38 MapK or Akt phosphorylation. Likewise, expression of the downstream targets Bcl-xl and Baff were unaffected. Together these data suggest that engagement of Ly49A selectively inhibits signals downstream of the TCR but spares those unique to CD28. These results suggest that when considering its use as an immunotherapy, the potency of inhibitory receptors such as Ly49A may be further improved by pairing them with costimulatory blockade. © 2009 Elsevier Inc. All rights reserved.