Smad7, a negative regulator of TGF- signaling, has been implicated in the pathogenesis and treatment of inflammatory bowel diseases (IBDs), including Crohn’s disease (CD) and ulcerative colitis (UC). Here, we found that Smad7 mediates intestinal inflammation by limiting the PDL2/1-PD1 axis in dendritic cells (DCs) and CD4+T cells. Smad7 deficiency in DCs promotes TGF- responsiveness and the co-inhibitory molecules PDL2/1 on DCs, and it further imprints T cell-PD1 signaling to promote Treg differentiation. DC-specific Smad7 deletion mitigates DSS-induced colitis by inducing CD103+PDL2/1+DCs and Tregs. In addition, Smad7 deficiency in CD4+T cells promotes PD1 and PD1-induced Tregs in vitro. The transfer of Smad7-deficient CD4+T cells enhances Tregs in vivo and protects against T cell-mediated colitis. Furthermore, Smad7 antisense ameliorates DSS-induced UC, increasing TGF- and PDL2/1-PD1 signaling. Enhancing PD1 signaling directly via Fc-fused PDL2/1 is also beneficial. Our results identify how Smad7 mediates intestinal inflammation and leverages these pathways therapeutically, providing additional strategies for IBD intervention. Copyright 2019 The Author(s). Published by Elsevier Inc. All rights reserved.