Plasmacytoid dendritic cells (pDCs) are an immune subset devoted to the production of high amounts of type 1 interferons in response to viral infections. Whereas conventional dendritic cells (cDCs) originate mostly from a common dendritic cell progenitor (CDP), pDCs have been shown to develop from both CDPs and common lymphoid progenitors. Here, we found that pDCs developed predominantly from IL-7R+ lymphoid progenitor cells. Expression of SiglecH and Ly6D defined pDC lineage commitment along the lymphoid branch. Transcriptional characterization of SiglecH+Ly6D+ precursors indicated that pDC development requires high expression of the transcription factor IRF8, whereas pDC identity relies on TCF4. RNA sequencing of IL-7R+ lymphoid and CDP-derived pDCs mirrored the heterogeneity of mature pDCs observed in single-cell analysis. Both mature pDC subsets are able to secrete type 1 interferons, but only myeloid-derived pDCs share with cDCs their ability to process and present antigen.