Invariant NKT (iNKT) cells play key roles in host defense by recognizing lipid Ags presented by CD1d. iNKT cells are activated by bacterial-derived lipids and are also strongly autoreactive toward self-lipids. iNKT cell responsiveness must be regulated to maintain effective host defense while preventing uncontrolled stimulation and potential autoimmunity. CD1d-expressing thymocytes support iNKT cell development, but thymocyte-restricted expression of CD1d gives rise to Ag hyperresponsive iNKT cells. We hypothesized that iNKT cells require functional education by CD1d(+) cells other than thymocytes to set their correct responsiveness. In mice that expressed CD1d only on thymocytes, hyperresponsive iNKT cells in the periphery expressed significantly reduced levels of tyrosine phosphatase SHP-1, a negative regulator of TCR signaling. Accordingly, heterozygous SHP-1 mutant mice displaying reduced SHP-1 expression developed a comparable population of Ag hyperresponsive iNKT cells. Restoring nonthymocyte CD1d expression in transgenic mice normalized SHP-1 expression and iNKT cell reactivity. Radiation chimeras revealed that CD1d(+) dendritic cells supported iNKT cell upregulation of SHP-1 and decreased responsiveness after thymic emigration. Hence, dendritic cells functionally educate iNKT cells by tuning SHP-1 expression to limit reactivity.