T-cell depletion therapy is used to prevent acute allograft rejection, treat autoimmunity and create space for bone marrow or hematopoietic cell transplantation. The evolved response to T-cell loss is a transient increase in IL-7 that drives compensatory homeostatic proliferation (HP) of mature T cells. Paradoxically, the exaggerated form of this process that occurs following lymphodepletion expands effector T-cells, often causing loss of immunological tolerance that results in rapid graft rejection, autoimmunity, and exacerbated graft-versus-host disease (GVHD). While standard immune suppression is unable to treat these pathologies, growing evidence suggests that manipulating the incipient process of HP increases allograft survival, prevents autoimmunity, and markedly reduces GVHD. Multipotent adult progenitor cells (MAPC) are a clinical grade immunomodulatory cell therapy known to alter.-chain cytokine responses in T-cells. Herein, we demonstrate that MAPC regulate HP of human T-cells, prevent the expansion of Th1, Th17, and Th22 effectors, and block the development of pathogenic allograft responses. This occurs via IL-1 beta-primed secretion of PGE2 and activates T-cell intrinsic regulatory mechanisms (SOCS2, GADD45A). These data provide proof-of-principle that HP of human T-cells can be targeted by cellular and molecular therapies and lays a basis for the development of novel strategies to prevent immunopathology in lymphodepleted patients.