MAPKs are evolutionarily conserved immune regulators. MAPK phosphatases (MKPs) that negatively regulate MAPK activities have recently emerged as critical players in both innate and adaptive immune responses. MKP-1, also known as DUSP1, was previously shown to negatively regulate innate immunity by inhibiting pro-inflammatory cytokine production. Here, we found that MKP-1 is necessary in T cell activation and function. MKP-1 deficiency in T cells impaired the activation, proliferation, and function of T cells in vitro, associated with enhanced activation of JNK and reduced NFATc1 translocation into the nucleus. Consistently, MKP-1(-/-) mice were defective in anti-influenza immunity in vivo and resistant to experimental autoimmune encephalomyelitis. Our results thus demonstrate that MKP-1 is a critical positive regulator of T cell activation and function and may be targeted in treatment of autoimmune diseases.