The PD-L1/2-PD-1 immune checkpoint is essential for the proper induction of peripheral tolerance and limits autoimmunity, whereas tumor cells exploit their expression to promote immune evasion. Many different cell types express PD-L1/2, either constitutively or upon stimulation, but the factors driving this expression are often poorly defined. In this study, using genome-wide CRISPR activation screening, we identified three factors that upregulate PD-L1 expression: GATA2, MBD6, and transcription cofactor vestigial-like protein 3 (VGLL3). VGLL3 acts as a transcriptional regulator, and its expression induced PD-L1 in many different cell types. Conversely, loss of VGLL3 impaired IFN-γ-induced PD-L1/2 expression in human keratinocytes. Mechanistically, by performing a second screen to identify proteins acting in concert with VGLL3, we found that VGLL3 forms a complex with TEAD1 and RUNX1/3 to drive expression of PD-L1/2. Collectively, our work identified a new transcriptional complex controlling PD-L1/2 expression and suggests that VGLL3, in addition to its known role in the expression of proinflammatory genes, can balance inflammation by upregulating the anti-inflammatory factors PD-L1 and PD-L2.

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