Allergic diseases including asthma have risen considerably in prevalence in the last 50 years. A concomitant rise in autoimmune disease suggests a defect in immunoregulation, rather than a reduction in T-helper type 1 immunity. Immune responses to innocuous environmental antigens in health are characterized by dominant regulation through the production of interleukin-10 and transforming growth factor-beta. Recent studies suggest that diverse populations of regulatory T cells (Treg) play an important role in regulating T-helper type 2 (Th2) responses to allergens, maintaining functional tolerance. Regulatory responses appear to be compromised in allergic individuals but may be reconstituted to some extent with specific allergen immunotherapy. In experimental models, Treg can suppress Th2 responses to allergen, airway eosinophilia, mucous hypersecretion, and airway hyperresponsiveness. Further studies are required to precisely define the mechanisms of development and action of these cells, and to identify and evaluate novel targets for the treatment of allergic diseases.