ILDR2 is a member of the B7-like family of proteins that regulate T cell activity, is also a known endoplasmic reticulum molecule that regulates lipid homeostasis. The human ILDR2 lumenal domain shares a 99% and 98% homology with the mouse and rat respectively. The human gene encoding ILDR2 is located in a region on Chr1q23–25 that has been associated with type 2 diabetes. ILDR2 plays critical roles in hepatic clearance of lipoproteins and in lipid homeostasis. ILDR2 regulates human dendritic cells (DC2 cells, a subpopulation of polarized DCs that promotes Th2 differentiation). Recent publications reported that ILDR2 displayed negative regulatory functions on human and mouse T cells in various experimental systems. Fusion protein of ILDR2 lumenal domain with an Fc fragment, displays therapeutic effects in collagen-induced arthritis (CIA), a mouse model of rheumatoid arthritis (RA). ILDR2 represents a novel B7-like ligand that exerts negative immune modulation via interaction with a putative counterpart receptor expressed on activated T cells.