Challenge with peptide Ag in the absence of adjuvant results in tolerance of CD8 T cells specific for the Ag. In contrast, administration of IL-12 along with peptide results in massive clonal expansion, development of effector function, and establishment of a long-lived memory population. Using adoptive transfer of TCR-transgenic CD8 T cells, this effect of IL-12 is shown to be independent of CD4 T cells and to require costimulation provided by CD28 and possibly LFA-1. IL-12 supports responses when IL-12Rbeta1-deficient mice are used as recipients for the adoptively transferred CD8 T cells, demonstrating that the IL-12 is acting directly on the T cells rather than on host APC. These results provide strong support for a three-signal model for in vivo activation of naive CD8 T cells by peptide Ag, in which the presence or absence of the third signal determines whether tolerance or activation occurs. In contrast, memory CD8 T cells are effectively activated by peptide Ag in the absence of IL-12 or adjuvant.