Expanded polyclonal T regulatory cells (Tregs) offer great promise for the treatment of immune-mediated diseases. Inhibition by Tregs is under the control of the T-cell receptor (TCR). Therefore, we created Tregs with defined antigen specificity, using a recombinant T-cell receptor isolated from a myelin-basic protein specific T-cell clone of a multiple sclerosis (MS) patient (Ob2F3). We expressed this TCR using a retroviral expression vector in human Tregs from peripheral blood. We observed that transduced Tregs were activated in vitro in response to myelin basic protein (MBP) peptide on DR15 antigen-presenting cells (APC) and upregulated Treg markers, Foxp3, LAP and Helios. These engineered MBP-specific Tregs could suppress MBP-specific T effector cells, and were also able to suppress T cells with other specificities after Tregs had been activated through the TCR. Importantly, we showed that these engineered Tregs were able to function effectively in the presence of strong TLR-induced inflammatory signals, and that MBP-specific Tregs ameliorated EAE in myelin oligodendrocyte glycoprotein (MOG)-immunized DR15 transgenic mice. We further demonstrated in vitro that IL-2 produced by neighboring effector T cells activated MBP-specific Tregs, initiating contact-independent suppression to T effectors in local milieu. Mechanistic studies demonstrated that bystander suppression in vivo may involve transfer of soluble mediators, enhanced by cell contact between Tregs and effectors. Taken together, we show that engineered clonal MBP-specific Tregs are able to suppress autoimmune pathology in EAE. This approach may serve as a cellular therapy for MS patients with the common DR15 haplotype that is associated with disease susceptibility.