Cytokines play an important role in modulating the development and function of dendritic cells (DCs). Type I IFNs activate DCs and drive anti-viral responses, whereas IL-4 is the prototype of a Th2 cytokine. Evidence suggests that type I IFNs and IL-4 influence each other to modulate DC functions. We found that two type I IFNs, IFN-alpha and IFN-beta, stimulated a similar costimulatory profile in myeloid resting DCs. IL-4 suppressed the response of myeloid DCs to both type I IFNs in vitro and in vivo by impairing the up-regulation of MHC and costimulatory molecules and the production of cytokines, such as IL-6 and IL-15, and anti-viral genes, such as Mx-1, upon type I IFN stimulation. In dissecting the mechanism underlying this inhibition, we characterized the positive feedback loop that is triggered by IFN-alpha in primary DCs and found that IL-4 inhibited the initial phosphorylation of STAT1 and STAT2 (the transducers of signaling downstream of IFN-alpha and -beta receptors (IFNARs)) and reduced the up-regulation of genes involved in the amplification of the IFN response such as IRF-7, STAT1, STAT2, IFN-beta, and the IFNARs in vitro and in vivo. Therefore, IL-4 renders myeloid DCs less responsive to paracrine type I IFNs and less potent in sustaining the autocrine positive loop that normally amplifies the effects of type I IFNs. This inhibition could explain the increased susceptibility to viral infections observed during Th2-inducing parasitoses.