Rel/NF-κB transcription factors regulate inflammatory and immune responses. Despite possible subunit redundancy, NF-κB1-deficient (Nfkb1-/-) mice were profoundly protected from sterile CD4 T cell-dependent acute inflammatory arthritis and peritonitis. We evaluated CD4 T cell function in Nfkb1-/- mice and found increased apoptosis and selectively reduced GM-CSF production. Apoptosis was blocked by expression of a Bcl-2 transgene without restoring a disease response. In contrast with wildtype cells, transfer of Nfkb1-/- or GM-CSF-deficient CD4 T cells into RAG-1-deficient (Rag1-/-) mice failed to support arthritis induction. Injection of GM-CSF into Nfkb1-/- mice fully restored the disease response, suggesting that T cells are an important source of GM-CSF during acute inflammation. In Ag-induced peritonitis, NF-κB1-dependent GM-CSF production in CD4 T cells was required for disease and for generation of inflammatory monocyte-derived dendritic cells (MoDC), but not conventional dendritic cells. MoDC were identified in inflamed synovium and draining lymph nodes during arthritis. These MoDC produced high levels of MCP-1, a potent chemoattractant for monocytes. This study revealed two important findings: NF-κB1 serves a critical role in the production of GM-CSF by activated CD4 T cells during inflammatory responses, and GM-CSF derived from these cells drives the generation of MoDC during inflammatory disease.