The devastating neurodegenerative disease multiple sclerosis (MS) could substantially benefit from an adeno-associated virus (AAV) immunotherapy designed to restore a robust and durable antigen-specific tolerance. However, developing a sufficiently potent and lasting immune-regulatory therapy that can intervene in ongoing disease is a major challenge and has thus been elusive. We addressed this problem by developing a highly effective and robust tolerance-inducing in vivo gene therapy. Using a pre-clinical animal model, we designed a liver-targeting gene transfer vector that expresses full-length myelin oligodendrocyte glycoprotein (MOG) in hepatocytes. We show that by harnessing the tolerogenic nature of the liver, this powerful gene immunotherapy restores immune tolerance by inducing functional MOG-specific regulatory T cells (Tregs) in vivo, independent of major histocompatibility complex (MHC) restrictions. We demonstrate that mice treated prophylactically are protected from developing disease and neurological deficits. More importantly, we demonstrate that when given to mice with preexisting disease, ranging from mild neurological deficits to severe paralysis, the gene immunotherapy abrogated CNS inflammation and significantly reversed clinical symptoms of disease. This specialized approach for inducing antigen-specific immune tolerance has significant therapeutic potential for treating MS and other autoimmune disorders.