Macrophages are critical players in both innate and adaptive immunity. While the exogenous signaling events leading to the terminal differentiation of macrophages from monocytes have been studied extensively, the underlying intracellular transcriptional mechanisms remain poorly understood. Here we report that the homeobox transcription factor VentX plays a pivotal role in human macrophage terminal differentiation and proinflammatory function. Our study showed that VentX expression was upregulated upon human primary monocyte-to-macrophage differentiation induced by cytokines such as M-CSF, GM-CSF, and IL-3. Moreover, ablation of VentX expression in primary monocytes profoundly impaired their differentiation to macrophages, and ectopic expression of VentX in a myeloid progenitor cell line triggered its differentiation with prominent macrophage features. Further analysis revealed that VentX was pivotal for the proinflammatory response of terminally differentiated macrophages. Mechanistically, VentX was found to control expression of proteins key to macrophage differentiation and activation, including M-CSF receptor. Importantly, preliminary analysis of gene expression in leukocytes from patients with autoimmune diseases revealed a strong correlation between levels of VentX and those of proinflammatory cytokines. Our results provide mechanistic insight into the crucial roles of VentX in macrophage differentiation and proinflammatory activation and suggest that dysregulation of VentX may play a role in the pathogenesis of autoimmune diseases.