Promising immunotherapeutic tools for T cell-mediated pathologies are alternatively activated dendritic cells (aaDC), which exert their effect through the regulation and tolerization of T cells. As naïve and memory T cells have different susceptibilities to tolerogenic signals, it is important to understand the modulatory effects of aaDC on these T cell subsets. We have examined regulation of naïve and memory CD4+ T cells by human aaDC generated with dexamethasone, the active form of vitamin D3, 1alpha,25-dihydroxyvitamin D3, and LPS. Although aaDC induced low, primary, allogeneic responses by naïve and memory T cells, aaDC regulated the differentiation of these T cell subsets in a distinct manner. Naïve T cells primed by aaDC retained a strong, proliferative capacity upon restimulation but were skewed toward a low IFN-gamma/high IL-10 cytokine profile. In contrast, memory T cells primed by aaDC became hyporesponsive in terms of proliferation and cytokine production. Induction of anergy in memory T cells by aaDC was not a result of the presence of CD25hi regulatory T cells and could be partially reversed by IL-2. Both T cell subsets acquired regulatory activity and inhibited primary CD4 and CD8 responses. Addition of exogenous IL-12p70 during T cell priming by aaDC prevented anergy induction in memory T cells and cytokine polarization in naïve T cells, indicating that the lack of IL-12p70 is a key feature of aaDC. Our finding that aaDC differentially regulate naïve and memory T cells is important for understanding and maximizing the therapeutic potential of aaDC.