Background B7-1 transgenic mice exhibit exaggerated and persistent contact hypersensitivity responses compared with normal mice. Objective Because B7-1 and B7-2 deliver different costimulatory signals to T cells during antigen presentation, the purpose of this study was to compare B7-1 and B7-2 on keratinocytes and to compare their effects on contact hypersensitivity. Methods Contact hypersensitivity was studied in transgenic mice whose keratinocytes constitutively expressed B7-1, B7-2, or no costimulatory molecules (nontransgenic mice). Results B7-1 transgenic mice, and to a lesser extent B7-2 transgenic mice, developed exaggerated ear swelling responses after sensitization and challenge with haptens such as trinitrochlorobenzene or dinitrofluorobenzene. Ear swelling responses in B7-1 transgenic mice were characterized by the presence of markedly elevated inflammatory cytokine transcripts (IL-6, TNF-α, and lymphotoxin β) as well as IL-10 compared with either B7-2 or nontransgenic mice. Hapten-specific IgE was detected by ELISA in B7-1 transgenic mice but not B7-2 transgenic or nontransgenic mice. Only B7-1 transgenic mice exhibited significant immediate type ear swelling responses to the hapten trinitrochlorobenzene. In addition, their sera can passively transfer cutaneous anaphylaxis to naive C57BL/6 mice, indicating that the hapten-specific IgE was relevant to the immediate ear swelling responses. Conclusion These data suggest that keratinocyte-derived costimulation mediated by B7-1 but not B7-2 results in the emergence of T H2-lymphocyte immune responses to T H1 haptens. Because human keratinocytes have been noted to express B7-1–like molecules in certain inflammatory skin diseases, this model may be important in understanding the pathophysiology of T H2-lymphocyte–mediated skin diseases such as atopic dermatitis.