The prevalence of atopic asthma, a Th2-dependent disease, is reaching epidemic proportions partly due to improved hygiene in industrialized countries. There is an inverse correlation between the level of environmental endotoxin exposure and the prevalence of atopic sensitization. As dendritic cells (DC) have been implicated in causing sensitization to inhaled Ag, we studied the effect of endotoxin on Th2 development induced by bone marrow DC in vitro and by intratracheal injection in vivo, with particular emphasis on the role played by the polarizing cytokine IL-12. Bone marrow-derived DC stimulated with Escherichia coli O26:B6 LPS produced IL-12p70 for a limited period of time, after which production became refractory to further stimulation with CD40 ligand, a phenomenon previously called "exhaustion." The level of IL-12 production of DC did not correlate with Th1 development, as exhausted OVA-pulsed DC were still capable of shifting the cytokine pattern of responding OVA-specific Th cells toward Th1 in vitro and in vivo. When mice were first immunized by intratracheal injection of OVA-DC and subsequently challenged with OVA aerosol, prior in vitro stimulation of DC with LPS reduced the development of airway eosinophilia and Th2 cytokine production. Most surprisingly, the capacity of LPS to reduce Th2-dependent eosinophilic airway inflammation was IL-12-independent altogether, as IL-12p40 knockout DC had a similar reduced capacity to prime for Th2 responses. These results suggest that LPS reduces sensitization to inhaled Ag by reducing DC-driven Th2 development, but that IL-12 is not necessary for this effect.