The transcription factors mediating the development of CD1d-restricted invariant NKT (iNKT) cells remain incompletely described. Here, we show that loss of the AP-1 transcription factor Fra-2 causes a marked increase in the number of both thymic and peripheral iNKT cells, without affecting the development of other T-lineage cells. The defect is cell-autonomous and is evident in the earliest iNKT precursors. We find that iNKT cells expressing the lower affinity TCRVbeta8 are proportionally overrepresented in the absence of Fra-2, indicating altered selection of iNKT cells. There is also widespread dysregulation of AP-1-directed gene expression. In the periphery, mature Fra-2-deficient iNKT cells are able to participate in an immune response, but they have an altered response to Ag, showing increased expansion and producing increased amounts of IL-2 and IL-4 compared with their wild-type counterparts. Unusually, naive Fra-2-deficient T cells also rapidly produce IL-2 and IL-4 upon activation. Taken together, these data define Fra-2 as necessary for regulation of normal iNKT cell development and function, and they demonstrate the central role played by the AP-1 family in this lineage.