The CD8 co-receptor is important in the differentiation and selection of class I MHC-restricted T cells during thymic development, and in the activation of mature T lymphocytes in response to antigen. Here we show that soluble CD8alphaalpha receptor, despite an extremely low affinity for MHC, inhibits activation of cytotoxic lymphocytes by obstructing CD3 zeta-chain phosphorylation. We propose a model for this effect that involves interference of productive receptor multimerization at the T-cell surface. These results provide new insights into the mechanism of T-cell activation and evidence that CD8 function is exquisitely sensitive to disruption, an effect that might be exploited by molecular therapeutics.