Dendritic cells (DC) arise from a diverse group of hematopoietic progenitors and have marked phenotypic and functional heterogeneity. The signal transduction pathways that regulate the ability of progenitors to undergo DC differentiation, as well as the specific characteristics of the resulting DC, are only beginning to be characterized. We have found previously that activation of protein kinase C (PKC) by cytokines or phorbol esters drives normal human CD34(+) hematopoietic progenitors and myeloid leukemic blasts (KG1, K562 cell lines, and primary patient blasts) to differentiate into DC. We now report that PKC activation is also required for cytokine-driven DC differentiation from monocytes. Of the cPKC isoforms, only PKC-betaII was consistently activated by DC differentiation-inducing stimuli in normal and leukemic progenitors. Transfection of PKC-betaII into the differentiation-resistant KG1a subline restored the ability to undergo DC differentiation in a signal strength-dependent fashion as follows: 1) by development of characteristic morphology; 2) the up-regulation of DC surface markers; 3) the induction of expression of the NFkappaB family member Rel B; and 4) the potent ability to stimulate allo-T cells. Most unexpectedly, the restoration of PKC-betaII signaling in KG1a was not directly due to overexpression of the transfected classical PKC (alpha, betaII, or gamma) but rather through induction of endogenous PKC-beta gene expression by the transfected classical PKC. The mechanism of this positive autoregulation involves up-regulation of PKC-beta promoter activity by constitutive PKC signaling. These findings indicate that the regulation of PKC-betaII expression and signaling play critical roles in mediating progenitor to DC differentiation.