Asthma is a major public health problem that has increased markedly in prevalence in the past two decades. In several mouse models, natural killer T cells (NKT) have recently been found to be required for the development of airway hyperreactivity (AHR), a cardinal feature of asthma. Moreover, in patients with persistent severe asthma, a significant number of NKT cells are present in the lungs. While T cell receptor signaling is required to activate NKT cells, the costimulatory requirements for NKT cell activation and function are not clear. In this study we found that ICOS was highly expressed on both naïve and activated NKT cells and that expression of ICOS was much higher on the CD4+ NKT than CD4 NKT cells. The function of NKT cells from ICOS−/− mice was impaired, as adoptive transfer of these cells into NKT cell deficient Ja18−/− mice failed to restore AHR, whereas transfer of wildtype NKT cells fully restored AHR in the Ja18−/− recipients. The failure of ICOS−/− NKT to induce AHR may be due to a great extent to the absence of cytokine production by ICOS−/− NKT cells. Additionally, ICOS−/− mice challenged with α-GalCer did not develop AHR, but adoptive transfer of WT NKT cells into ICOS−/− mice restored AHR. Finally, ICOS may be required for CD4+ NKT cell survival in the periphery, as the number of CD4+ NKT cells was significantly lower in spleen and liver of ICOS−/− mice. These results indicate that costimulation by ICOS is required for the function and homeostasis of CD4+ NKT cells, which play a major role in development of AHR.