Tumor growth promotes the expansion of CD4⁺CD25⁺ regulatory T (T reg) cells that counteract T cell–mediated immune responses. An inverse correlation between natural killer (NK) cell activation and T reg cell expansion in tumor-bearing patients, shown here, prompted us to address the role of T reg cells in controlling innate antitumor immunity. Our experiments indicate that human T reg cells expressed membrane-bound transforming growth factor (TGF)–β, which directly inhibited NK cell effector functions and down-regulated NKG2D receptors on the NK cell surface. Adoptive transfer of wild-type T reg cells but not TGF-β^−/− T reg cells into nude mice suppressed NK cell–mediated cytotoxicity, reduced NKG2D receptor expression, and accelerated the growth of tumors that are normally controlled by NK cells. Conversely, the depletion of mouse T reg cells exacerbated NK cell proliferation and cytotoxicity in vivo. Human NK cell–mediated tumor recognition could also be restored by depletion of T reg cells from tumor-infiltrating lymphocytes. These findings support a role for T reg cells in blunting the NK cell arm of the innate immune system.