Differentiation of murine T-helper (Th) 17 cells is induced by antigenic stimulation and the sequential action of the cytokines IL-6, IL-21, and IL-23, along with TGFβ. Current dogma proposes that IL-6 induces IL-21, which, in a STAT3-dependent manner, amplifies its own transcription, contributes to IL-17 production, and, moreover, promotes the expression of the IL-23 receptor. This, in turn, prepares cells for IL-23-mediated stabilization of the Th17 phenotype. Here we demonstrate that these effects of IL-21 on Th17 differentiation are completely dependent on IFN regulatory factor 4 (IRF4). After culturing in the presence of IL-21 plus TGFβ, IRF4-deficient (Irf4^−/−) Th cells showed a profound intrinsic defect in IL-17 production and in the autocrine IL-21 loop. Likewise, the levels of IL-23 receptor and the lineage-specific orphan nuclear receptors RORα and RORγt were diminished, whereas the T regulatory (Treg) transcription factor forkhead box P3 (Foxp3) was strongly up-regulated, consistent with the reciprocal relationship between Th17 and Treg development. Despite this loss of IL-21 functions, IL-21-induced STAT3 activation was unimpaired and induced normal Socs3 expression. Forced expression of Foxp3 in WT cells inhibited IL-21-mediated IL-17 production, suggesting that the increase in Foxp3 contributes to the Irf4^−/− phenotype. Additionally, the low levels of RORα and RORγt are also partially responsible, because simultaneous overexpression of both proteins restored IL-17 production in Irf4^−/− cells to some extent. These data highlight IRF4 as a decisive factor during the IL-21-mediated steps of Th17 development by influencing the balance of Foxp3, RORα, and RORγt.