This application extends work performed during the previous project period, in which we investigated the mechanism of chromatin-based regulation of cytokine genes in the mouse Th2 locus, which encodes the Il4, Il13, Rad50 and Il5 genes. We showed that Th1 and Th2 differentiation were accompanied by long-range chromatin changes in activated as well as silenced cytokine genes, as judged by changes in DNase I hypersensitive (DH) sites, DNA methylation and histone modification; explored the transcriptional and chromatin-based programs underlying CD8 T cell differentiation; and defined the functions of multiple regulatory regions in the Il4, Ifng and Il10 loci. Related studies were performed in many other labs, resulting in our current detailed and comprehensive understanding of the transcriptional and chromatin-level changes that form the molecular basis for the various directions of CD4 and CD8 T cell differentiation. During this project period, we will broaden the scope of our studies beyond an exclusive analysis of the Th2 cytokine locus. We recently discovered that the TET proteins TET1, TET2 and TET3 constitute a new family of 2-oxoglutarate (2OG)- and Fe(II)-dependent oxygenases, that convert 5- methylcytosine (5mC) to 5-hydroxymethylcytosine (hmC) in DNA. Moreover, we demonstrated that hmC is a physiological constituent of mammalian DNA, and that hmC levels and TET mRNA levels are both regulated in T cells and several other cell types. These are exciting findings because hydroxylation of 5mC alters DNA methylation status in a hitherto unprecedented way, and because DNA methylation is relevant to several fields including mammalian development, cancer, aging, cell lineage specification, genome defense and stem cell function. In this proposal, we focus on the question of whether TET proteins and hmC have a role in cell differentiation and cell lineage specification, using T cells as a tractable model system for studying cell differentiation in culture as well as in vivo. Our overall goal is to define the biological roles of Tet-family proteins in T cells and potentially other cells of the immune system, taking advantage of our long familiarity with gene regulation in naive, activated and differentiating T cells. In Aim 1, we will analyze hmC levels and Tet occupancy at relevant genes in naive, activated and differentiating murine CD4 and CD8 T cells. In Aim 2, we will use mice with conditional deletions of Tet1, Tet2 and Tet3 genes to examine the importance of Tet proteins for T cell function. These proposed studies should advance our understanding of the biological functions of hmC and Tet proteins, and provide a new perspective into how DNA methylation status might regulate gene expression.