The functions of dendritic cells (DCs) are tightly regulated such that protective immune responses are elicited and unwanted immune responses are prevented. 1 alpha 25-dihydroxyvitamin D(3) (1 alpha 25(OH)(2)D(3)) has been identified as a major factor that inhibits the differentiation and maturation of DCs, an effect dependent upon its binding to the nuclear vitamin D receptor (VDR). Physiological control of 1 alpha 25(OH)(2)D(3) levels is critically dependent upon 25-hydroxyvitamin D(3)-1 alpha-hydroxylase (1 alpha OHase), a mitochondrial cytochrome P450 enzyme that catalyzes the conversion of inactive precursor 25-hydroxyvitamin D(3) (25(OH)D(3)) to the active metabolite 1 alpha 25(OH)(2)D(3). Using a human monocyte-derived DC (moDC) model, we have examined the relationship between DC VDR expression and the impact of exposure to its ligand, 1 alpha 25(OH)(2)D(3). We show for the first time that moDCs are able to synthesize 1 alpha 25(OH)(2)D(3) in vitro as a consequence of increased 1 alpha OHase expression. Following terminal differentiation induced by a diverse set of maturation stimuli, there is marked transcriptional up-regulation of 1 alpha OHase leading to increased 1 alpha OHase enzyme activity. Consistent with this finding is the observation that the development and function of moDCs is inhibited at physiological concentrations of the inactive metabolite 25(OH)D(3). In contrast to 1 alpha OHase, VDR expression is down-regulated as monocytes differentiate into immature DCs. Addition of 1 alpha 25(OH)(2)D(3) to moDC cultures at different time points indicates that its inhibitory effects are greater in monocyte precursors than in immature DCs. In conclusion, differential regulation of endogenous 1 alpha 25(OH)(2)D(3) ligand and its nuclear receptor appear to be important regulators of DC biology and represent potential targets for the manipulation of DC function.