Dendritic cells (DCs) play a key role in initiating immune responses and maintaining immune tolerance. In addition to playing a role in thymic selection, DCs play an active role in tolerance under steady state conditions through several mechanisms which are dependent on IL-10, TGF-β, retinoic acid, indoleamine-2,3,-dioxygenase along with vitamin D. Several of these mechanisms are employed by DCs in induction of regulatory T cells which are comprised of Tr1 regulatory T cells, natural and inducible foxp3+ regulatory T cells, Th3 regulatory T cells and double negative regulatory T cells. It appears that certain DC subsets are highly specialized in inducing regulatory T cell differentiation and in some tissues the local microenvironment plays a role in driving DCs towards a tolerogenic response. In this review we discuss the recent advances in our understanding of the mechanisms underlying DC driven regulatory T cell induction.