BM-derived DC (BMDC) are powerful antigen-presenting cells. When loaded with immune complexes (IC), consisting of tumor antigens bound to antitumor antibody, BMDC induce powerful antitumor immunity in mice. However, attempts to employ this strategy clinically with either tumor-associated DC (TADC) or monocyte-derived DC (MoDC) have been disappointing. To investigate the basis for this phenomenon, we compared the response of BMDC, TADC, and MoDC to tumor IgG-IC. Our findings revealed, in both mice and humans, that upon exposure to IgG-IC, BMDC internalized the IC, increased costimulatory molecule expression, and stimulated autologous T cells. In contrast, TADC and, surprisingly, MoDC remained inert upon contact with IC due to dysfunctional signaling following engagement of Fcγ receptors. Such dysfunction is associated with elevated levels of the Src homology region 2 domain-containing phosphatase-1 (SHP-1) and phosphatases regulating Akt activation. Indeed, concomitant inhibition of both SHP-1 and phosphatases that regulate Akt activation conferred upon TADC and MoDC the capacity to take up and process IC and induce antitumor immunity in vivo. This work identifies the molecular checkpoints that govern activation of MoDC and TADC and their capacity to elicit T cell immunity.