Dendritic cells (DC), professional antigen-presenting cells of the immune system, exert important functions both in induction of T cell immunity, as well as tolerance. It is well established that the main function of immature DC (iDC) in their in vivo steady-state condition is to maintain peripheral tolerance to self-antigens and that these iDC mature upon encounter of so-called danger signals and subsequently promote T cell immunity. Previously, it was believed that T cell unresponsiveness induced after stimulation with iDC is caused by the absence of inflammatory signals in steady-state in vivo conditions and by the low expression levels of costimulatory molecules on iDC. However, a growing body of evidence now indicates that iDC can also actively maintain peripheral T cell tolerance by the induction and/or stimulation of regulatory T cell populations. Moreover, several reports indicate that traditional DC maturation can no longer be used to distinguish tolerogenic and immunogenic properties of DC. This review will focus on the complementary role of dendritic cells in inducing both tolerance and immunity, and we will discuss the clinical implications for dendritic cell-based therapies.