The appeal of using embryonic stem (ES) cells for regenerative medicine lies in their pluripotency and resulting ability to differentiate into all somatic cell types. While graft rejection remains the greatest hurdle to their use in the clinic, several approaches have been proposed to protect the allogeneic ES cell-derived grafts from host immunity: the creation of nuclear transfer human ES (hES) cell lines; the development of parthenogenic hES cells and iPS cells; the establishment of a bank of clinically-approved lines; the generation of hematopoietic chimerism and the induction of peripheral tolerance in recipients. Here, we discuss how the immune-privileged features of ES cells and tissues derived from them may influence these approaches and review the strategies and mechanisms involved in sustaining antigen-specific tolerance through interplay between dendritic cells (DC) and regulatory T cells (Treg). This overview therefore surveys prospects for developing novel regimes to prolong acceptance of ES cell-derived tissues with minimal use of immunosuppressive drugs.