CD8+ T cell responses to chronic infection and cancer are sustained by stem-like precursors of exhausted T (Tpex) cells that express high levels of memory-related transcriptional regulators including TCF1 and ID3. Here, we identify a critical role for ID3 in promoting continuous differentiation of Tpex cells to sustain ongoing T cell responses in chronic infection. Mechanistically, we show that ID3 regulates the developmental progression of stem-like Tpex cells expressing CD62L and MYB to Tpex cells marked by expression of the tyrosine-protein kinase c-Kit, which itself promoted T cell expansion and effector differentiation. Finally, we demonstrate that ID3 expression in memory T cells that develop after acute infection or T cells activated in the presence of IL-18 promoted the generation of Tpex cells and thus superior T cell responses when challenged with chronic infection or cancer. Thus, we identify a critical role for ID3 in promoting functional and long-lasting T cell responses in chronic infection and cancer.