Plasmacytoid dendritic cells (pDCs) are specialized immune cells capable of producing large amounts of type I interferon (IFN) and other proinflammatory cytokines in response to viral infections. To date, a multicomponent cytoplasmic transductional-transcriptional complex and a spatiotemporal mechanism have been revealed in pDCs that mediate the rapid and robust IFN production after Toll-like receptor activation. Multiple regulatory mechanisms involving surface receptors, intracellular and exogenous factors as well as virally encoded molecules have been shown to modulate the IFN responses in these cells. The unique innate immune functions of pDCs are crucial both in infectious diseases and in autoimmune diseases. The recent research progress provides an in-depth understanding of the biology of pDCs and a sensible basis for future therapeutic interventions.