Extracellular vesicles (EVs) are generated by all cells and systemic injection of allogenic EVs derived from epithelial or mesenchymal cells into humans and immunocompetent mice do not elicit any immune response despite the presence of ~1,200 proteins. Nevertheless, EVs from immune cells are purported to play a role in immune regulation associated with cancer and other diseases. To specifically address whether epithelial cells derived EVs can be modified to inherently acquire a capacity to induce immune response, we engineered epithelial 293T EVs to harbor the immunomodulatory CD80, OX40L and PD-L1 molecules. We demonstrated abundant levels of these proteins on the engineered EVs, without causing major morphological and molecular alterations in the donor cells and their shed EVs. Functionally, the engineered EVs efficiently elicit positive and negative T cells co-stimulation in both human and murine T cells ex vivo. The systemic administration of OX40L-containing EVs promotes anti-tumor immunity, whereas PD-L1-containing EVs suppresses T cell-mediated anti-tumor responses. Conversely, OX40L EVs worsen the progression of auto-immune hepatitis, while PD-L1 EVs ameliorate it. Moreover, OX40L EVs synergize with anti-CTLA-4 to delay tumor growth and extend the survival of melanoma-bearing mice. Taken together, our work provides evidence that while epithelial cells derived EVs are immunologically inert when systemically infused in large numbers, the same EVs can be engineered to induce immune response with translational potential to modulate T cell functions in pathological settings.