Aryl hydrocarbon receptor (AhR) activation by 2,3,7,8-tetrachlorodibenzo-p-dioxin (TCDD) leads to immune suppression associated with the induction of regulatory T cells (T(reg)) expressing the transcription factor Foxp3. The immunological mechanisms of suppression are not well understood however dendritic cells (DC) are considered a key target for AhR-mediated immune suppression. Here we show that activation of AhR by TCDD induces DC indoleamine 2,3-dioxygenase 1 (IDO1) and indoleamine 2,3-dioxygenase-like protein (IDO2). Induction of IDO1 and IDO2 was also found in lung and spleen associated with an increase of the T(reg) marker Foxp3 in spleen of TCDD-treated C57BL/6 mice, which is suppressed by inhibition of IDO. These data indicate that AhR-activation is an important signaling pathway for IDO expression and suggest a critical role of IDO in the mechanism leading to the generation of T(reg) that mediates the immune suppression through activation of AhR.