Ikaros family zinc finger 1 (IKZF1) is a haematopoietic transcription factor required for mammalian B-cell development. IKZF1 deficiency also reduces plasmacytoid dendritic cell (pDC) numbers in mice, but its effects on human DC development are unknown. Here we show that heterozygous mutation of IKZF1 in human decreases pDC numbers and expands conventional DC1 (cDC1). Lenalidomide, a drug that induces proteosomal degradation of IKZF1, also decreases pDC numbers in vivo, and reduces the ratio of pDC/cDC1 differentiated from progenitor cells in vitro in a dose-dependent manner. In addition, non-classical monocytes are reduced by IKZF1 deficiency in vivo. DC and monocytes from patients with IKZF1 deficiency or lenalidomide-treated cultures secrete less IFN-α, TNF and IL-12. These results indicate that human DC development and function are regulated by IKZF1, providing further insights into the consequences of IKZF1 mutation on immune function and the mechanism of immunomodulation by lenalidomide.