The present invention provides ungulates, including pigs, expressing CTLA4-Ig, as well as tissue, organs, cells and cell lines derived from such animals. Such animals, tissues, organs and cells can be used in research and medical therapy, including xenotransplanation. In addition, methods are provided to prepare organs, tissues and cells expressing the CTLA4-Ig for use in xenotransplantation, and nucleic acid constructs and vectors useful therein.