Natural killer T (NKT) cells are a population of innate-like lymphocytes that express both NK and T cell markers. Following activation by the recognition of glycolipid antigen presented in the context of CD1d, NKT cells have been shown to play important roles in infection, autoimmunity, and cancer. The research undertaken herein sought to determine factors important for NKT cell development and activation to further understand the potential of NKT cells in cancer immunotherapy. We characterized thymic NKT subsets in different strains of mice and demonstrated that both the size and the subset distribution of the NKT cell population is dependent on genetic factors. By developing sensitive methods to track cellular proliferation, we identified baseline differences in NKT cell subset activation parameters. Specifically, NK1.1+ NKT cells were less likely to enter cell cycle after stimulation, divided less when activated, and were more adversely affected by CD28 costimulatory blockade compared to NK1.1- NKT cells. In our lymphoma and breast cancer studies, we show that NKT cell recognition of cancer cells can be enhanced by the presence of an activating ligand, but not by PI3K inhibitors or CARP-1 functional mimetics. Additionally, NKT cell-mediated cytotoxicity is enhanced by, but not dependent on, CD1d engagement. Whereas NK1.1+ NKT cells are the optimal subset of NKT cells for use in cancer immunotherapy because of their potent cytolytic abilities, activation of NK1.1- NKT cells could pose a threat to anti-tumor immunity, attributable to their secretion of immunosuppressive or regulatory cytokines. Collectively, our data demonstrate a critical role for CD1d engagement and costimulation for optimal activation of NK1.1+ NKT cells. Due to the fact that cancers often downregulate CD1d and do not express costimulatory molecules, our data highlight the need for the development of strategies focused on inducing the activation of specific subsets of NKT cells for cancer immunotherapy.