Plasmacytoid dendritic cells (pDCs), originating from hematopoietic progenitor cells in the BM, are a unique dendritic cell subset that can produce large amounts of type I IFNs by signaling through the nucleic acid–sensing TLR7 and TLR9 (TLR7/9). The molecular mechanisms for pDC function and development remain largely unknown. In the present study, we focused on an Ets family transcription factor, Spi-B, that is highly expressed in pDCs. Spi-B could transactivate the type I IFN promoters in synergy with IFN regulatory factor 7 (IRF-7), which is an essential transcription factor for TLR7/9-induced type I IFN production in pDCs. Spi-B–deficient pDCs and mice showed defects in TLR7/9-induced type I IFN production. Furthermore, in Spi-B–deficient mice, BM pDCs were decreased and showed attenuated expression of a set of pDC-specific genes whereas peripheral pDCs were increased; this uneven distribution was likely because of defective retainment of mature nondividing pDCs in the BM. The expression pattern of cell-surface molecules in Spi-B–deficient mice indicated the involvement of Spi-B in pDC development. The developmental defects of pDCs in Spi-B–deficient mice were more prominent in the BM than in the peripheral lymphoid organs and were intrinsic to pDCs. We conclude that Spi-B plays critical roles in pDC function and development.