Although an immunoregulatory role of aryl hydrocarbon receptor (Ahr) has been demonstrated in T cells and macrophages, little is known about its function in dendritic cells (DC). Here, we show that lipopolysaccharide (LPS) and CpG stimulate Ahr expression in bone marrow-derived dendritic cells (BMDC). Furthermore, we found that Ahr is required to induce indoleamine 2,3-dioxygenase (IDO) expression, an immunosuppressive enzyme that catabolizes tryptophan into kynurenine (Kyn) and other metabolites in DC. In the presence of LPS or CpG, Ahr-deficient (Ahr(-/-)) mature BMDC induced immune responses characterized by reduced Kyn and IL-10 production compared with results observed with tolerogenic mature WT BMDC. In a coculture system with LPS- or CpG-stimulated BMDC and naive T cells, Ahr(-/-) BMDC inhibited naive T-cell differentiation into regulatory T (Treg) cells, which likely facilitated Th17 cell development and promoted naive T-cell proliferation. Addition of synthetic L-Kyn to the coculture system skewed the differentiation of naive T cells to Treg cells rather than Th17 cells. Taken together, our results demonstrate a previously unknown negatively regulatory role for Ahr in DC-mediated immunogenesis in the presence of LPS or CpG, which, in turn, alters the Kyn-dependent generation of Treg cells and Th17 cells from naive T cells.