Abstract Development of natural regulatory T cells (nTregs) is requisite to maintain central tolerance. nTregs are believed to develop after receiving strong T cell receptor (TCR) signals during T cell maturation in the thymus. This notion comes from experimental systems wherein TCR transgenic T cells adopt the Treg fate only if their cognate antigen is present in the thymus during development. However, whether strong TCR signals drive nTreg development in a polyclonal setting and the specific signaling pathways downstream of the TCR necessary for nTreg development remain elusive. In this study, we selectively perturbed the lipid second messenger diacylglycerol (DAG), which is a critical component of TCR signaling. Using mice that lack DAG kinase-ζ (DGKζ), a negative regulator of DAG, we demonstrate that enhanced DAG signals result in a significant increase in nTreg development in a cell-autonomous manner. DGKζ-deficient T cells exhibited increased c-Rel and ERK signaling, suggesting that these downstream pathways may contribute to enhanced Treg development in DGKζ-deficient mice. Indeed, the absence of c-Rel almost completely abrogated the increase in Treg development observed in DGKζ-deficient mice. Moreover, inhibition of ERK also prevented Treg development in the absence of DGKζ. Our study shows that (1) nTreg development is enhanced by increased TCR signaling in a polyclonal setting and (2) DGKζ limits nTreg development by attenuating signals leading to ERK and c-Rel activation.