Hen egg lysozyme 52-61-specific CD4+ T cells responded by interleukin 2 (IL-2) secretion to any peptide containing this epitope regardless of length of NH2- and COOH-terminal composition. However, CD4- variants could only respond to peptides containing the two COOH-terminal tryptophans at positions 62 and 63. Substitutions at these positions defined patterns of reactivity that were specific for individual T cells inferring a T cell receptor (TCR)-based phenomenon. Thus, the fine specificity of major histocompatibility complex (MHC)-peptide recognition by the TCR was dramatically affected by CD4 and the COOH-terminal peptide composition. Peptides that failed to induce IL-2 secretion in the CD4- variants nevertheless induced strong tyrosine phosphorylation of CD3 zeta. Thus, whereas the TCR still recognized and bound to the MHC class II-peptide complex resulting in protein phosphorylation, this interaction failed to induce effective signal transduction manifested by IL-2 secretion. This provides a clear example of differential signaling mediated by peptides known to be naturally processed. In addition, the external domains of CD4, rather than its cytoplasmic tail, were critical in aiding TCR recognition of all peptides derived from a single epitope. These data suggest that the nested flanking residues, which are present on MHC class II but not class I bound peptides, are functionally relevant.