During retroviral infection, viral capsids are subject to restriction by the cellular factor TRIM5α. Here, we show that dendritic cells (DCs) derived from human and non-human primate species lack efficient TRIM5α-mediated retroviral restriction. In DCs, endogenous TRIM5α accumulates in nuclear bodies (NB) that partly co-localize with Cajal bodies in a SUMOylation-dependent manner. Nuclear sequestration of TRIM5α allowed potent induction of type I interferon (IFN) responses during infection, mediated by sensing of reverse transcribed DNA by cGAS. Overexpression of TRIM5α or treatment with the SUMOylation inhibitor ginkgolic acid (GA) resulted in enforced cytoplasmic TRIM5α expression and restored efficient viral restriction but abrogated type I IFN production following infection. Our results suggest that there is an evolutionary trade-off specific to DCs in which restriction is minimized to maximize sensing. TRIM5α regulation via SUMOylation-dependent nuclear sequestration adds to our understanding of how restriction factors are regulated.