Dendritic cells (DCs) form a remarkable cellular network that shapes adaptive immune responses according to peripheral cues. After four decades of research, we now know that DCs arise from a hematopoietic lineage distinct from other leukocytes, establishing the DC system as a unique hematopoietic branch. Recent work has also established that tissue DCs consist of developmentally and functionally distinct subsets that differentially regulate T lymphocyte function. This review discusses major advances in our understanding of the regulation of DC lineage commitment, differentiation, diversification, and function in situ.