Background. In human lung transplantation, chronic rejection is accompanied by obliterative bronchiolitis (013), a fibrosing inflammatory condition that leads to occlusion of the bronchial lumen and graft failure. The pathogenesis of this disorder is poorly understood, but likely involves antigen presentation by dendritic cells (DC). We studied the presence and activation status of DCs in transplanted tracheas in a mouse model of OB and studied the effect on graft luminal patency of blocking the costimulatory B7RP-1/inducible costimulator (ICOS) pathway. Methods. Tracheas from Balb/C or from C57Bl/6 mice were transplanted heterotopically under the dorsal skin of C57Bl/6 mice. Histologic, fluorescence-activated cell sorter, and quantitative-polymerase chain reaction analyses were performed after 1, 2, or 4 weeks. In sonic groups, treatment with blocking rat anti-mICOS antibodies or irrelevant rat immunoglobulin G was administered during the entire observation period. Results. After heterotopic transplantation, both CD103(+)CDI lb(-) and CD103(-)CD11b(+)MHC II+DCs accumulated in the airway epithelium as early as I week after allogeneic (mismatched) but not syngeneic (matched) transplantation. Four weeks after Tx, infiltration with CD11c(+) MHCII+DCs and CD8(+) lymphocytes, luminal fibrosis and epithelial damage were more pronounced in the allogeneic than in the syngeneic setting. There was a 10-fold up-regulation of ICOS mRNA and of chemokines involved in T-cell influx in the mismatched setting compared with the matched setting. Strikingly, anti-ICOS treatment without other immunosuppression prevented luminal fibrosis in mismatched transplants. Conclusions. Our results suggest that early infiltration by DC occurs in posttransplant OB. Blocking critical costimulatory molecules expressed on DCs, as in the B7RP1-ICOS pathway, prevents epithelial damage and luminal fibrosis.