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T cell activity is controlled by a combination of antigen-dependent signaling through the T cell receptor and a set of auxiliary signals delivered through antigen-independent interactions, including the recognition of the B7 family of ligands. B7-H3 is a recently identified B7 family member that is strongly overexpressed in a range of cancers and correlates with poor prognosis. We report the crystal structure of murine B7-H3 at a 3 Å resolution, which provides a model for the organization of the IgV and IgC domains within the ectodomain. We demonstrate that B7-H3 inhibits T cell proliferation and show that the FG loop of the IgV domain plays a critical role in this function. B7-H3 crystallized as an unusual dimer arising from the exchange of the G strands in the IgV domains of partner molecules. This arrangement, in combination with previous reports, highlights the dynamic nature and plasticity of the immunoglobulin fold.