Inflammatory damage of mucosal surface of the eye is a hallmark of dry eye disease (DED) and, in severe cases, can lead to significant discomfort, visual impairment, and blindness. DED is a multifactorial autoimmune disorder with a largely unknown pathogenesis. Using a cross-sectional patient study and a well-characterized murine model of DED, herein we investigated the immunoregulatory function of interleukin-22 (IL-22) in the pathogenesis of DED. We found that IL-22 levels were elevated in lacrimal fluids of DED patients and inversely correlated with severity of disease. Acinar cells of the lacrimal glands (LGs), not inflammatory immune cells, are the primary source of IL-22, which suppresses inflammation in ocular surface epithelial cells upon desiccating stress. Moreover, loss of function analyses using IL-22 knockout mice demonstrated that IL-22 is essential for suppression of ocular surface infiltration of Th17 cells and inhibition of DED induction. Our novel findings elucidate immunoregulatory function of LG-derived IL-22 in inhibiting IL-17-mediated ocular surface epitheliopathy in DED thus making IL-22 a new relevant therapeutic target.