Induction of B cell tolerance or activation was analyzed with vesicular stomatitis virus (VSV) glycoprotein (G) expressed as a neo-self Ag. A membrane form of VSV-G expressed in all tissues, including the bone marrow, induced unresponsiveness at both the Th and B cell level, whereas a soluble form of VSV-G expressed peripherally in liver and kidney did not tolerize B cells and only reversibly anergized Th cells. Interestingly, a similar correlation was found for activation of mature lymphocytes. When mature normal spleen cells were transferred into the two transgenic mouse lines, the membrane form of VSV-G was strongly immunogenic for both Th and B cells, and high VSV-G-specific IgG Ab titers were induced in these transgenic mice. In contrast, spleen cells transferred into mice expressing the soluble form of VSV-G were not activated, and no VSV-G specific Abs were induced. These results indicate that highly immunogenic Ags are strongly tolerogenic for both immature B and T cells.