The CD25⁻ and CD25⁺ CD4 T-lymphocyte compartments are tightly regulated. We show here that tumors break such balance, increasing the number of CD4⁺CD25⁺ T cells in draining lymph node and spleen but not contralateral node of tumor-bearing mice. Tumor injection in thymectomized and CD25-depleted mice shows that CD4⁺CD25⁺ T-cell expansion occurs even in the absence of the thymus and independently from proliferation of preexisting CD25⁺ T cells. These newly generated cells are bona fide regulatory T cells (T reg) in terms of Foxp3 expression and suppression of CD3-stimulated or allogeneic effector cell proliferation. Transfer of congenic Thy1.1 CD4⁺CD25⁻ T cells, from mice treated or not with vinblastine, into tumor-bearing or tumor-free mice and analysis of recovered donor lymphocytes indicate that conversion is the main mechanism for acquiring the expression of CD25 and Foxp3 through a process that does not require proliferation. Although conversion of CD4⁺CD25⁻ T cells for generation of T regs has been described as a natural process that maintains peripheral T-reg population, this process is used by the tumor for immune escape. The prompt recovery of T regs from monoclonal antibody–mediated CD25 depletion in tumor-bearing mice suggests attempts able to inactivate rather than deplete them when treating existing tumors. (Cancer Res 2006; 66(8): 4488-95)