B7H1 (PDL1) and B7DC (PDL2) are two new members of the B7 family that can interact with PD-1, a putative negative regulator for immune function. Recent studies have provided evidence for inhibitory functions of both members via PD-1. Meanwhile, compelling evidence exists for costimulatory function of both members. Here we demonstrate that expression of B7DC on the tumor cells promotes CD8 T cell–mediated rejection of tumor cells, at both the induction and effector phase of antitumor immunity. Moreover, B7DC binds to PD-1(−/−) cells and enhances T cell killing in a PD-1–independent mechanism. Our results demonstrate a novel pathway for B7DC to promote tumor immunity and may reconcile the apparently contradictory findings on the function of B7DC.