The thymus is an organ that plays a key role in controlling immune responses and immune tolerance. The thymus promotes immune tolerance by deleting and removing self-reactive T cells from the immune system. In addition, the thymus also helps drive the production of important suppressor T cell populations like regulatory T cells that also control immune tolerance. Thus, strategies that expand and improve thymic function could be critical in improving transplantation of tissues derived from embryonic stem cells. The thymus consists of a supporting network of thymic epithelial cells that help bone marrow derived T cell precursors mature and differentiate into fully functional T lymphocytes. Despite their importance, there has been little progress in methods to grow and expand out the supportive thymic epithelial network. This project will explore strategies to grow and expand out functional thymic epithelial cells from human embryonic stem cells using a multi-step culturing technique. These expanded thymic epithelial cells will be characterized and tested for the ability to support T cell development and differentiation. Finally, the expanded thymic epithelial cells will be put into transplantation models in humanized mice to test their ability to improve and enhance the acceptance of transplanted tissues. These studies offer enormous potential for promoting graft-specific immune tolerance in that embryonic stem cells could be differentiated into both a replacement tissue and into functional thymus.