Myeloid dendritic cells (mDCs) have long been thought to function as classical APCs for T cell responses. However, we demonstrate that influenza viruses induce rapid differentiation of human monocytes into mDCs. Unlike the classic mDCs, the virus-induced mDCs failed to upregulate DC maturation markers and were unable to induce allogeneic lymphoproliferation. Virus-induced mDCs secreted little, if any, proinflammatory cytokines; however, they secreted a substantial amount of chemoattractants for monocytes (MCP-1 and IP-10). Interestingly, the differentiated mDCs secreted type I IFN and upregulated the expression of IFN-stimulated genes (tetherin, IFITM3, and viperin), as well as cytosolic viral RNA sensors (RIG-I and MDA5). Additionally, culture supernatants from virus-induced mDCs suppressed the replication of virus in vitro. Furthermore, depletion of monocytes in a mouse model of influenza infection caused significant reduction of lung mDC numbers, as well as type I IFN production in the lung. Consequently, increased lung virus titer and higher mortality were observed. Taken together, our results demonstrate that the host responds to influenza virus infection by initiating rapid differentiation of circulating monocytes into IFN-producing mDCs, which contribute to innate antiviral immune responses.