Erythropoietin (EPO) is the main hormone that promotes proliferation and differentiation of erythroid progenitor cells via binding to its surface receptor (EPO-R). Recent studies suggest that this hormone may affect also other cell types, besides the red blood cell lineage. We have previously demonstrated that the immune system is a target of EPO; however, the direct target cells of EPO, as well as the molecular mechanisms underlying its role as an immunomodulator, are unknown. Here we present evidence for functional effects of EPO on dendritic cells (DCs), which are known to initiate the immune response. In-vivo experiments in EPO-injected mice and in transgenic mice over-expressing human EPO showed an increased splenic DC population with a higher cell surface expression of CD80 and CD86. Further analysis based on mouse models, showed that DCs derived in-vitro from bone marrow (BM-DCs) express EPO-R mRNA. In-vitro stimulation of these DCs with recombinant human EPO enhanced viability, upregulated CD80, CD86 and MHC class II and augmented the secretion of IL-12. Biochemical analysis of EPO mediated signaling in the BM-DCs showed activation of the AKT, MAPK and NF-kappaB pathways. EPO stimulation of the BM-DCs led to Tyr-phosphorylation of STAT3. The inability to detect EPO mediated activation of STAT5 in the BM-DCs, suggests that in DCs, STAT3 may play a more important role than STAT5 in EPO-R signaling. Taken together, our data support the premise that DCs are direct targets of EPO, thereby providing an insight to the immunomodulatory functions of EPO.