Indoleamine 2,3-dioxygenase (IDO) is a kind of dioxygenase that can catalyze the degradation of levo-tryptophan (L-Trp) and plays key roles in immune tolerance. In this study, the DO gene was cloned and functionally characterized from grass carp (gcIDO). The results showed that gcIDO overexpressed in GCO cells could catalyze the degradation of L-Trp through the L-Trp kynurenine pathway, and this activity could be promoted by delta-aminolevulinic acid (ALA) while inhibited by levo-1-methyl tryptophan (L-1MT). Moreover, gcIDO was constitutively expressed in various tissues, and its expression could be significantly up-regulated by LPS and Poly (I:C) in peripheral blood leukocytes (Pins). Furthermore, recombinant TGF-beta 1 of grass carp could up-regulate the expression of IDO, TGF-beta 1, CD25, and Foxp3 in PBLs, indicating that the TGF-beta 1/IDO pathway is present in fish. In the soybean meal induced enteritis (SBMIE) model, the expression of gcIDO in the intestine was upregulated significantly, demonstrating that gcIDO may play an immunoregulatory role in SBMIE. Taken together, these data suggest that the IDO plays multiple roles in the immunity of fish.