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Cellular therapy with CD4+FOXP3+ T regulatory (Treg) cells is a promising strategy to induce tolerance after solid-organ transplantation or prevent graft-versus-host disease after transfer of hematopoietic stem cells. Treg cells currently used in clinical trials are either polyclonal, donor- or antigen-specific. Aside from variations in isolation and expansion protocols, however, most therapeutic Treg cell-based products are much alike. Ongoing basic science work has provided considerable new insight into multiple facets of Treg cell biology, including their stability, homing, and functional specialization; integrating these basic science discoveries with clinical efforts will support the development of next-generation therapeutic Treg cells with enhanced efficacy. In this review, we summarize recent advances in knowledge of how Treg cells home to lymphoid and peripheral tissues, and control antibody production and tissue repair. We also discuss newly appreciated pathways that modulate context-specific Treg cell function and stability. Strategies to improve and tailor Treg cells for cell therapy to induce transplantation tolerance are highlighted.