Dysregulation of intestinal microflora is linked to inflammatory disorders associated with compromised immunosuppressive functions of Foxp3(+) T regulatory (Treg) cells. Although mucosa-associated commensal microbiota has been implicated in Treg generation, molecular identities of the "effector" components controlling this process remain largely unknown. Here, we have defined Bifidobacterium bifidum as a potent inducer of Foxp3(+) Treg cells with diverse T cell receptor specificity to dietary antigens, commensal bacteria, and B. bifidum itself. Cell surface beta-glucan/galactan (CSGG) polysaccharides of B. bifidum were identified as key components responsible for Treg induction. CSGG efficiently recapitulated the activity of whole bacteria and acted via regulatory dendritic cells through a partially Toll-like receptor 2-mediated mechanism. Treg cells induced by B. bifidum or purified CSGG display stable and robust suppressive capacity toward experimental colitis. By identifying CSGG as a functional component of Treg-inducing bacteria, our studies highlight the immunomodulatory potential of CSGG and CSGG-producing microbes.