Thymic dendritic cells (DC) mediate negative selection at a relatively late stage of the T-cell developmental pathway. We present evidence that the development of thymic DC and of T-lineage cells is linked via a common precursor at an early stage of thymocyte development. T-lineage precursor populations from the adult mouse thymus, prior to T-cell receptor gene rearrangement, display a capacity to produce DC as well as T cells in the thymus, and are very efficient precursors of DC in culture. These lymphoid/DC precursors have little capacity to form myeloid cells, indicating that thymic DC are a lymphoid-related rather than myeloid-related lineage. In contrast to myeloid-related DC, granulocyte-macrophage colony-stimulating factor is not required for the development of these lymphoid-related DC in vivo or in vitro. DC can develop in mutant mice lacking mature T cells, provided the common precursors are present. However, in mutant mice lacking functional Ikaros transcription factors, there are deficiencies in lymphoid precursor cells, in mature lymphoid cells and in DC.