Bowen's disease (BD), a carcinoma in situ of the skin, has been identified as an early lesion in arsenic carcinogenesis. Patients with arsenic-induced Bowen's disease (As-BD) showed both cutaneous and systemic immune dysfunctions. We set out to evaluate the interactions between keratinocytes and lymphocytes in the context of As-BD carcinogenesis. Our results showed that As-BD lesions demonstrated a significant dermal CD4+ cell, an essential regulator of proper tumor immunity, undergoing apoptosis. In addition, it was found that the As-BD patients have lower percentage of peripheral CD4+ cells as compared with control subjects. However, the CD4+ cells from As-BD patients were less susceptible to arsenic-induced apoptosis, due to reduced tumor necrosis factor receptor 1 expression. Interestingly, arsenic was found to induce Fas expression on CD4+ cells and increase the soluble Fas ligand (sFasL) production from keratinocytes. This sFasL-containing keratinocyte supernatant was able to induce comparable CD4+ cell apoptosis for both patients and controls. Using immunofluorescent staining, increased FasL was observed in keratinocytes of As-BD lesions and Fas was expressed among infiltrating CD4+ cells. Our findings suggested that systemically, the percentage of CD4+ cells was decreased in the peripheral blood of As-BD patients. These residual CD4+ cells were less susceptible to arsenic-induced apoptosis. However, once infiltrated into the As-BD lesions, the selective CD4+ cell apoptosis might be mediated by FasL from keratinocytes. This additional tumor-anti-immune phenomenon present in the cutaneous environment provides a reasonable explanation for frequent occurrence of arsenic cancers in the skin.