Transforming growth factor beta 1 (TGF-beta1) induces Langerhans cell (LC) differentiation from CD34+ hematopoietic progenitor cells (HPCs). LCs form tight networks in the epidermis that critically depend on TGF-beta1-mediated inhibition of LC activation. However, the underlying mechanisms of TGF-beta1 signaling during LC differentiation remain poorly understood. In this study, we aimed to study the transcriptional regulation of LC differentiation and to dissect the TGF-beta1 signaling pathway downstream of LC differentiation. We here identified that TGF-beta1 utilizes the type-I receptor ALK3-SMAD1/5/8 cascade for inducing LC differentiation from HPCs. Conversely, signaling via the classical TGF-β1 receptor ALK5-SMAD2/3 cascade impaired LC differentiation and maturation by blocking pro-inflammatory cytokine production. We also identified BMP-7, an activator of ALK2/3 but not ALK5, induces LC differentiation that is associated with the selective activation of SMAD1/5/8. Moreover, TGF-beta1 induced the epithelial signaling protein beta-catenin in progenitor cells undergoing LC differentiation and beta-catenin promotes LC differentiation. Vitamin D, another epidermal signal, enhanced TGF-beta1-mediated beta-catenin induction and promoted the expression of multiple epithelial genes by LCs. Moreover, full length vitamin D receptor (VDR) promoted, whereas a truncated VDR diminished the positive effects of ectopic beta-catenin on LC differentiation indicating a functional interaction among beta-catenin and VDR in these cells. On the other hand, during activation, LCs change from a sessile, adhesive phenotype to a motile phenotype by inducing mesenchymal genes like N-cadherin and transcriptional regulators ZEB1/ZEB2. We propose that TGF-beta1-ALK3-dependent induction of beta-catenin is critical for LC differentiation and that the TGF-beta1-ALK5 cascade preserves an immature epithelial resident LC phenotype.