Dendritic cells (DCs), though rare in tumors, are key players in anti-tumor immunity. Using Zbtb46-reporter mice, we performed single-cell RNA sequencing to profile tumor-infiltrating DCs. Unsupervised clustering identified a cluster of activated interferon gamma-exposed DCs (IFNγ-DCs) derived from type 2 conventional DCs (cDC2s). We were also able to identify this cluster in human data sets. Similar to migratory DCs (mDCs), IFNγ-DCs were able to induce T cell proliferation and activation ex vivo, demonstrating robust antigen presentation capacity. However, unlike mDCs, IFNγ-DCs do not express CCR7 and do not upregulate CCR7 in response to DAMPs ex vivo. Rather, IFNγ-DCs persist in the tumor and express higher levels of CXCL9 and CXCL10 than mDCs demonstrated through scRNA-Seq and flow cytometry. Conditional deletion of the IFN-γ receptor in DCs reduced IFNγ-DC abundance and abolished anti-PD1 therapy response without affecting T cell priming, highlighting the functional specificity of IFN-DCs. Additionally, adding in vitro generated IFNγ-DCs back into established tumors increased T cell activation and abundance, as well as significantly slowed tumor growth. Spatial transcriptomics and confocal imaging demonstrated that IFNγ-DCs localize closer to T cells and CD8 T cells than mDCs, as well as confirmed distinct localization patterns within the tumor microenvironment. Finally, IFNγ inhibited CCR7 upregulation in Flt3L generated bone marrow derived DCs. These findings reveal a division of labor among activated DC subsets within tumors whereby mDCs initiate T cell priming in lymph nodes, while IFN-DCs sustain T cell function locally in tumors, influencing immunotherapy outcomes.