The invention provides methods for inhibiting T-cell mediated rejection of a xenotransplanted organ by blocking the delivery of co-stimulatory signal 2 (the B7/CD28 interaction) prevent the activation of xenoreactive T-cells in the recipient. In a first aspect, co-stimulation is prevented by administration to the organ recipient of a soluble form of CTLA-4 from the xenogeneic donor organism. In a second aspect, co-stimulation is antagonized by expressing a ligand for CTLA-4 on the xenogeneic donor cells. In a third aspect, co-stimulation is prevented by expressing recipient organism MHC class II on the surface of the cells of the xenogeneic donor organ.