Dendritic cells (DCs) control the strength and quality of antigen-specific T and B cell responses. Recent advances point to a novel mechanism, in which metabolism of vitamin A into retinoic acid (RA) in DCs, regulate critical parameters of lymphocyte differentiation. First, RA enhances the induction of Foxp3(+) T regulatory cells by DCs. Thus, specific subsets of intestinal DCs and macrophages constitutively express RA synthesizing enzymes, and induce T regulatory cells. In addition, RA programs DCs to imprint mucosal homing properties on activated T and B cells, and enhanced induction of immunoglobulin-A (IgA) by B cells. Here, we review these recent advances, in the context of the pleiotropic effects of RA in regulating diverse biological processes.