Dendritic cells (DC) are the professional antigen presenting cells (APC) that bridge the innate and adaptive immune system. Previously, in a CD11c/EYFP transgenic mouse developed to study DC functions, we anatomically mapped and phenotypically characterized a discrete population of EYFP+ cells within the microglia that we termed brain dendritic cells (bDC). In this study, we advanced our knowledge of the function of these cells in the CD11c/EYFP transgenic mouse and its chimeras, using acute stimuli of stereotaxically inoculated IFN gamma or IL-4 into the CNS. The administration of IFN gamma increased the number of EYFP+ bDC but did not recruit peripheral DC into the CNS. IFN gamma, but not IL-4, upregulated the expression levels of major histocompatibility class II (MHC-II). In addition, IFN gamma-activated EYFP(+)bDC induced antigen-specific naive CD4 T cells to proliferate and secrete Th1/Th17 cytokines. Activated bDC were also able to stimulate naive CD8 T cells. Collectively, these data reveal the Th1 cytokine IFN gamma, but not the Th2 cytokine IL4, induces bDC to up-regulate MHC-II and become competent APC.