Delta-like ligand 4 (Dll4)–Notch signaling is essential for T cell development and alternative thymic lineage decisions. How Dll4–Notch signaling affects pro-T cell fate and thymic dendritic cell (tDC) development is unknown. We found that Dll4 pharmacological blockade induces accumulation of tDCs and CD4+CD25+FoxP3+ regulatory T cells (Treg cells) in the thymic cortex. Both genetic inactivation models and anti-Dll4 antibody (Ab) treatment promote de novo natural Treg cell expansion by a DC-dependent mechanism that requires major histocompatibility complex II expression on DCs. Anti-Dll4 treatment converts CD4−CD8−c-kit+CD44+CD25− (DN1) T cell progenitors to immature DCs that induce ex vivo differentiation of naive CD4+ T cells into Treg cells. Induction of these tolerogenic DN1-derived tDCs and the ensuing expansion of Treg cells are Fms-like tyrosine kinase 3 (Flt3) independent, occur in the context of transcriptional up-regulation of PU.1, Irf-4, Irf-8, and CSF-1, genes critical for DC differentiation, and are abrogated in thymectomized mice. Anti-Dll4 treatment fully prevents type 1 diabetes (T1D) via a Treg cell–mediated mechanism and inhibits CD8+ T cell pancreatic islet infiltration. Furthermore, a single injection of anti-Dll4 Ab reverses established T1D. Disease remission and recurrence are correlated with increased Treg cell numbers in the pancreas-draining lymph nodes. These results identify Dll4–Notch as a novel Flt3-alternative pathway important for regulating tDC-mediated Treg cell homeostasis and autoimmunity.