Despite accumulating evidence for the importance of allospecific CD8(+) regulatory T cells (Tregs) in tolerant rodents and free immunosuppression transplant recipients, mechanisms underlying CD8(+) Treg-mediated tolerance remain unclear. By using a model of transplantation tolerance mediated by CD8(+) Tregs following CD40Ig treatment in rats, in this study, we show that the accumulation of tolerogenic CD8(+) Tregs and plasmacytoid dendritic cells (pDCs) in allograft and spleen but not lymph nodes was associated with tolerance induction in vascularized allograft recipients. pDCs preferentially induced tolerogenic CD8(+) Tregs to suppress CD4(+) effector cells responses to first-donor Ags in vitro. When tolerogenic CD8(+) Tregs were not in contact with CD4(+) effector cells, suppression was mediated by IDO. Contact with CD4(+) effector cells resulted in alternative suppressive mechanisms implicating IFN-gamma and fibroleukin-2. In vivo, both IDO and IFN-gamma were involved in tolerance induction, suggesting that contact with CD4(+) effector cells is crucial to modulate CD8(+) Tregs function in vivo. In conclusion, CD8(+) Tregs and pDCs interactions were necessary for suppression of CD4(+) T cells and involved different mechanisms modulated by the presence of cell contact between CD8(+) Tregs, pDCs, and CD4(+) effector cells.