Despite the existence of ocular immune privilege, immune rejection may be a barrier to successful retinal transplantation. We have examined in mice the extent to which the subretinal space (SRS) is an immune privileged site, and whether retinal pigment epithelium and neuronal retinal tissue have properties of immune privileged tissues. We report that (1) The SRS is an immune privileged site; (2) Neonatal RPE is an immune privileged tissue; (3) Neuronal retina is a partially immune privileged tissue; and (4) Microglia within neonatal neural retina grafts promote photoreceptor differentiation, become activated, and induce sensitization of the recipient and serve as targets of immune rejection.