In xenotransplantation models, direct activation of hCD4(+) T cells by porcine VECs leads to a robust proliferation of T cells. To investigate the underlying mechanisms, human antiporcine MLEC culture was used to investigate cross-species cell interactions, proliferation of hCD4(+) T cells, and induction of human cytokines. We report that xenoantigen presentation by PIEC expands hCD4(+) Foxp3(+) Tregs and hCD4(+) Foxp3(-) Teffs, and this process is dependent on porcine MHC-II antigen expression. Stable transfection of hPD-L1 into PIEC inhibits Teff proliferation, but Treg proliferation is not affected. Surprisingly, IL-10 production by hCD4(+) T cells is augmented significantly by PIEC(hPD-L1). Notably, hPD-L1-induced Tregs have higher suppressive potency and mediate suppressive function partially through IL-10 and CD73. This study opens the possibility of using hPD-L1-overexpressing porcine VECs as a novel therapeutic to allow tolerance of xenotransplants and also supports the possibility of using hPD-L1 transgenic pigs as xenotransplant donors.