Compositions containing soluble B7-H4 (sH4) antagonists in an amount effective to reduce, inhibit, or mitigate an inflammatory response in an individual and methods for the treatment or prophylaxis of inflammatory disorders and autoimmune diseases or disorders are provided. Soluble H4 has been discovered to interfere with B7-H4 activity including B7-H4's activity as an inhibitor of T cell immunity. Thus, interference of sH4 biological activity is an effective method to restore B7-H4 activity and thereby provide an effective method for treating inflammatory diseases or disorders including autoimmune diseases or disorders. B7-H4Ig could also work as an agonist to suppress both humoral and cellular autoimmunity.