Pregnancy stimulates an intricately coordinated assortment of physiological changes to accommodate growth of the developing fetus, while simultaneously averting rejection of genetically foreign fetal cells and tissues. Despite increasing evidence that expansion of immune-suppressive maternal regulatory T cells enforces fetal tolerance and protects against pregnancy complications, the pregnancy-associated signals driving this essential adaptation remain poorly understood. Here we show that the female reproductive hormone, progesterone, coordinates immune tolerance by stimulating expansion of FOXP3+ regulatory T cells. Conditional loss of the canonical nuclear progesterone receptor in maternal FOXP3+ regulatory T cells blunts their proliferation and accumulation, which is associated with fetal wastage and decidual infiltration of activated CD8+ T cells. Reciprocally, the synthetic progestin 17α-hydroxyprogesterone caproate (17-OHPC) administered to pregnant mice reinforces fetal tolerance and protects against fetal wastage. These immune modulatory effects of progesterone that promote fetal tolerance establish a molecular link between immunological and other physiological adaptions during pregnancy.