Extrathymic induction of regulatory T (T reg) cells is essential to the regulation of effector T cell responses in the periphery. In addition to Foxp3, T reg cell expression of suppressive cytokines, such as IL-10, is essential for peripheral tolerance, particularly in the intestines. TGF-beta has been shown to induce expression of Foxp3 as well as IL10 and the vitamin A metabolite; all-trans retinoic acid (RA [at-RA]) has been found to enhance the former. We report that in contrast to its enhancement of TGF-beta-mediated Foxp3 induction, at-RA potently inhibits the TGF-beta-mediated induction of Il10 in naive CD4 T cells. Thus, mucosal DC subsets that are active producers of at-RA inhibit induction of Il10 in naive CD4 T cells while promoting induction of Foxp3. Accordingly, mice with vitamin A deficiency have increased numbers of IL-10-competent T reg cells. Activation of DCs by certain Toll-like receptors (TLRs), particularly TLR9, suppresses T cell induction of Foxp3 and enables induction of Il10. Collectively, our data indicate that at-RA has reciprocal effects on the induction of Foxp3 and Il10 in developing CD4(+) T reg cells and suggest that TLR9-dependent inhibition of at-RA production by antigen-presenting cells might represent one mechanism to promote the development of IL-10-expressing T cells.