Presentation of antigenic peptides on MHC-II molecules is essential for induction of tolerance to self and for effective immunity against foreign pathogens. The non- classical MHC-II molecule DO (HLA-DO in humans, H2-O in mice) functions in selection of MHC-II epitopes by competitively inhibiting the peptide exchange factor DM. Previous studies have suggested a role for DO in development of autoimmunity and in the immune response to retroviral infection, presumably via modulation of the MHC-II peptidome, but the precise effect of DO has been difficult to discern. Through characterization of the full spectrum of peptides from DO-sufficient and DO-deficient cells, we demonstrate that DO functions to broaden the diversity of peptide species presented on MHC-II. DO is regulated differently from other components of the MHC-II processing machinery, with expression limited to B cell and dendritic cell subsets, as well as thymic epithelial cells, suggesting a role for DO in mediating central tolerance. In a mouse model lacking DO, we show that selection of T regulatory cells (Tregs) is increased and that DO- deficient Tregs are more activated and exert greater suppressive capacity. Despite augmented Treg function, mice lacking DO display enhanced susceptibility to autoimmunity, with altered germinal center (GC) Tregs and B cells indicative of an aberrant GC reaction. These data suggest that DO expression serves to fine-tune the immunopeptidome in order to promote self-tolerance to a wide spectrum of epitopes and to select a Treg population with appropriate specificity for self- antigens.