Transforming growth factor-beta (TGF-beta) and forkhead box p3-expressing T-regulatory (Treg) cells are critical in maintaining self-tolerance and immune homeostasis. The immune suppressive functions of TGF-beta and Treg cells are widely acknowledged and extensively studied. Nonetheless, recent studies revealed the positive roles of TGF-beta and Treg cells in shaping the immune system and the inflammatory responses. This review discusses our and other's efforts in understanding the negative (Yin) as well as the positive (Yang) roles for TGF-beta and Treg cells in immune regulation.