IL-10-producing CD1d ^hiCD5 ⁺ B cells, also known as B10 cells, have been shown to possess a regulatory function in the inhibition of immune responses, but whether and how B10 cells suppress the development of autoimmune arthritis remain largely unclear. In this study, we detected significantly decreased numbers of IL-10-producing B cells, but increased IL-17-producing CD4 ⁺ T (Th17) cells in both spleen and draining lymph nodes of mice during the acute stage of collagen-induced arthritis (CIA) when compared with adjuvant-treated control mice. On adoptive transfer of in vitro expanded B10 cells, collagen-immunized mice showed a marked delay of arthritis onset with reduced severity of both clinical symptoms and joint damage, accompanied by a substantial reduction in the number of Th17 cells. To determine whether B10 cells directly inhibit the generation of Th17 cells in culture, naive CD4 ⁺ T cells labeled with carboxyfluorescein succinimidyl ester (CFSE) were co-cultured with B10 cells. These B10 cells suppressed Th17 cell differentiation via the reduction of STAT3 phosphorylation and retinoid-related orphan receptor γt (RORγt) expression. Moreover, Th17 cells showed significantly decreased proliferation when co-cultured with B10 cells. Although adoptive transfer of Th17 cells triggered the development of collagen-induced arthritis in IL-17 ^-/-DBA/1J mice, co-transfer of B10 cells with Th17 cells profoundly delayed the onset of arthritis. Thus, our findings suggest a novel regulatory role of B10 cells in arthritic progression via the suppression of Th17 cell generation.