Human early thymic precursors have the potential to differentiate into multiple cell lineages, including T cells and plasmacytoid dendritic cells (pDCs). This decision is guided by the induction or silencing of lineage-specific transcription factors. The ETS family member Spi-B is a key regulator of pDC development, whereas T-cell development is critically dependent on GATA-3. Here we show that triggering of the Notch1 signaling pathway by Delta-like1 controls the T/pDC lineage decision by regulating the balance between these factors. CD34+ CD1a- thymic progenitor cells express Notch1, but down-regulate this receptor when differentiating into pDCs. On coculture with stromal cell lines expressing either human Delta-like1 (DL1) or Jagged1 (Jag1) Notch ligands, thymic precursors express GATA-3 and develop into CD4+ CD8+ TCRalphabeta+ T cells. On the other hand, DL1, but not Jag1, down-regulates Spi-B expression, resulting in impaired development of pDCs. The Notch1-induced block in pDC development can be relieved through the ectopic expression of Spi-B. These data indicate that DL1-induced activation of the Notch1 pathway controls the lineage commitment of early thymic precursors by altering the levels between Spi-B and GATA-3.