Hemophilia A is a bleeding disorder affecting 1 in 5000 males across all populations. Patients can be treated with protein therapeutics to replace the deficient coagulation co-factor VIII (FVIII), but in nearly 30% of affected individuals, the immune system mounts a response against the FVIII treatment forming antibodies that block its function (inhibitors). Ideally, patients should be tolerant to this human protein, but this is clearly not the case and inhibitor formation leads to increased morbidity and premature mortality. We propose that FVIII is particularly immunogenic because of its function in the coagulation cascade that leads to thrombin formation. We have used a mouse model for hemophilia to challenge this hypothesis. By studying the immune response following administration of physically inactivated FVIII or native FVIII while using anticoagulants, we have shown that FVIII is less immunogenic when it cannot activate downstream coagulation factors. This has led us to identify a previously unknown role for thrombin in the initiation of the immune response to FVIII. That is, thrombin generation is necessary for the formation of inhibitors to FVIII. The mechanism linking thrombin formation to the immunogenicity of FVIII may eventually lead to treatments that could be effective in previously untreated patients. To treat those that are currently forming inhibitors, it would be useful to have better techniques for inducing tolerance to FVIII. One solution is B-cell based gene therapy for tolerance induction. Previous data have indicated that host regulatory T (TReg) cells are involved in the mechanism for tolerance induction. To further study the role of TReg cells, we have developed new transgenic mouse models and adapted in-vitro assay methods. These new tools have allowed us to explore our hypothesis that tolerogenic B cells are effective because they induce antigen-specific TReg cells. Following tolerance induction to FVIII, we observed an increase in TReg cells and their effect could be detected in suppression assays. To elaborate on the antigen-specificity of these cells, we used a T cell receptor transgenic mouse. We have discovered that tolerogenic B cells can selectively induce antigen-specific TReg cells that are more suppressive than a polyclonal TReg population. B-cell gene therapy leads to an increase in TReg cells and a selective loss of antigen-specific responder cells. These changes in the lymphocyte population shift the balance away from effector function towards a tolerogenic phenotype. We hope that the novel hypotheses advanced in this thesis will help patients with hemophilia avoid inhibitory immune responses and the information on tolerance will have additional applications in fields ranging from autoimmunity to transplantation.