Monocytes represent a large pool of circulating precursors of APCs, both macrophages and dendritic cells (DCs). It is thus important to identify the mechanisms by which microenvironment regulates monocyte differentiation. We have previously shown that, upon contact with resting stromal cells such as fibroblasts, monocytes differentiate into macrophages in an IL-6/M-CSF-dependent fashion. Yet, in the inflamed tissue, monocytes need to yield DCs for the adaptive immunity to be induced. Inasmuch as TNF and IL-1 are present at the site of inflammation, we tested their capacity to modulate monocyte differentiation into either macrophages or DCs. TNF, but not IL-1, induce monocytes to become DCs despite the presence of fibroblasts. TNF-induced DCs contain Langerin-positive cells and are able to induce allogenic T cell proliferation. Then, TNF was found to decrease the expression and internalization of the M-CSF receptor, thus overriding the IL-6/M-CSF pathway. Thus, TNF facilitates the induction of adaptive immunity by promoting DC differentiation not only from CD34+ progenitors but also from CD14+ blood precursors.