Background: Sexual transmission accounts for the majority of HIV-1 infections. In over 75% of cases, infection is initiated by a single variant (transmitted/founder virus). However, the determinants of virus selection during transmission are unknown. Host cell-cell interactions in the mucosa may be critical in regulating susceptibility to infection. We hypothesized in this study that specific immune modulators secreted by uterine epithelial cells modulate susceptibility of dendritic cells (DC) to infection with HIV-1. Methodology/Principal Findings: Here we report that uterine epithelial cell secretions (i.e. conditioned medium, CM) decreased DC-SIGN expression on immature dendritic cells via a transforming growth factor beta (TGF-β) mechanism. Further, CM inhibited dendritic cell-mediated trans infection of HIV-1 expressing envelope proteins of prototypic reference. Similarly, CM inhibited trans infection of HIV-1 constructs expressing envelopes of transmitted/founder viruses, variants that are selected during sexual transmission. In contrast, whereas recombinant TGF- b1 inhibited trans infection of prototypic reference HIV-1 by dendritic cells, TGF-β1 had a minimal effect on trans infection of transmitted/founder variants irrespective of the reporter system used to measure trans infection. Conclusions/Significance: Our results provide the first direct evidence for uterine epithelial cell regulation of dendritic cell transmission of infection with reference and transmitted/founder HIV-1 variants. These findings have immediate implications for designing strategies to prevent sexual transmission of HIV-1. © 2010 Ochiel et al.