Dendritic cells (DC) represent a rare but multifunctional population of cells with the capacity to prime and orchestrate antigen-specific immune responses. Both human and mouse DC are classified to myeloid and plasmacytoid DC (pDC) with distinct functional activities. These DC subsets can be found in the peripheral blood and tissues as resting cells and act as sensors of environmental changes. Activation of DC by various stimuli induces morphological and functional changes and transforms these cells to potent antigen presenting and secretory cells. A newly identified precursor subset of human DC has recently been identified as professional type I interferon producing cells (IPC) with multiple functional activities. Interferon-producing cells, also referred as pDC act as a link between innate and adaptive immunity and possess the capacity to instruct and regulate pathogen- and tumor-specific immune responses. The role of IPC/pDC--partly mediated by type I interferons--has also been demonstrated in the pathogenesis of various diseases and could be used as a target for modulating immune responses.