We have previously shown that interleukin-2 (IL-2) inhibits dendritic cell (DC) development from mouse bone marrow (BM) precursors stimulated with the ligand for FMS-like tyrosine kinase 3 receptor (Flt3L), and have provided evidence that this inhibition occurs at the monocyte DC precursor stage of DC development. Here, we explored the mechanism of IL-2-mediated inhibition of DC development. First, we showed that these in vitro cultures accurately model DCs that develop in vivo by comparing gene and protein expression of the three main Flt3L-induced DC subsets from the BM, CD11b(+) and CD24(+) conventional DCs (cDCs) and plasmacytoid DCs (pDCs) with their respective ex vivo spleen DC subsets (CD11b(+), CD8(+) and pDCs). Next, gene expression changes were quantified in Flt3L DC subsets that developed in the presence of IL-2. These changes included increased expression of Bcl2l11, which encodes the apoptosis-inducing protein Bim, and decreased expression of Flt3 (CD135), the receptor that initiates DC development. Interleukin-2 also significantly reduced Flt3 protein expression on all three Flt3L DC subsets, and attenuated Flt3L-induced STAT3 phosphorylation in DCs. Based on these data, we hypothesized that decreased Flt3 signalling may divert BM precursors down monocyte and macrophage lineages. Indeed, addition of IL-2 led to increases in Flt3(-) cells, including cKit(+) Ly6C(+) CD11b(-) populations consistent with the recently identified committed monocyte/macrophage progenitor. Therefore, IL-2 can inhibit DC development via decreased signalling through Flt3 and increased monocyte/macrophage development.