Late loss of allograft function is primarily attributed to chronic rejection (CR). There are no effective treatments for CR and the underlying cause of the disease is unknown. This study compared events that occurred within cardiac allografts placed in mice that received either anti-CD4 therapy and develop CR or anti-CD40L therapy and do not develop CR. Both TGFβ and connective tissue growth factor (CTGF), which is induced by TGFβ, were expressed in grafts with CR but were not expressed in grafts without CR. TGFβ transfection of allografts in anti-CD40L-treated recipients resulted in CTGF expression and CR. However, TGFβ transfection of syngeneic grafts did not result in CTGF expression or CR. These data indicate that TGFβ alone is insufficient to induce CR and that CTGF is required. Further, antigenic stimulation is required for TGFβ induction of CTGF. Thus, CTGF may serve as a therapeutic target for CR.