Dendritic cells (DCs) initiate proinflammatory or regulatory T cell responses, depending on their activation state. Despite extensive knowledge of DC-activating signals, the understanding of DC inhibitory signals is relatively limited. We show that Src homology region 2 domain-containing phosphatase-1 (SHP-1) is an important inhibitor of DC signaling, targeting multiple activation pathways. Downstream of TLR4, SHP-1 showed increased interaction with several proteins including IL-1R-associated kinase-4, and modulated LPS signaling by inhibiting NF-κB, AP-1, ERK, and JNK activity, while enhancing p38 activity. In addition, SHP-1 inhibited prosurvival signaling through AKT activation. Furthermore, SHP-1 inhibited CCR7 protein expression. Inhibiting SHP-1 in DCs enhanced proinflammatory cytokines, IL-6, IL-12, and IL-1β production, promoted survival, and increased DC migration to draining lymph nodes. Administration of SHP-1-inhibited DCs in vivo induced expansion of Ag-specific cytotoxic T cells and inhibited Foxp3(+) regulatory T cell induction, resulting in an enhanced immune response against pre-established mouse melanoma and prostate tumors. Taken together, these data demonstrate that SHP-1 is an intrinsic global regulator of DC function, controlling many facets of T cell-mediated immune responses.