Growth factor-mobilized peripheral blood stem cells (PBSCs) engraft rapidly in myeloablated recipients compared to conventional BM, but this procedure also mobilizes mature lymphocytes and monocytes which can impact immune reconstitution and GVHD. Hence, we serially evaluated immune reconstitution and cytokine expression in PBSCT recipients in the first year. Engraftment of neutrophils and monocytes stabilized early but NK cells, B cells and CD4+ T cell numbers were significantly (P < 0.05) low with persistently reversed CD4:CD8 ratios. NK function remained low throughout the first year. The quantitative decrease in CD4+ T cells resulted in significantly decreased proliferation in response to mitogens and alloHLA antigens. Yet, a qualitative analysis of T cell function measured by Ca++ influx after T cell activation with antiCD3 as well as T-dependent polyclonal Ig secretion by mitogen-stimulated B cells was preserved even early post transplant. TNF alpha mRNA was detected in almost all recipients in the first year. IL-10 mRNA was detected in 77%, IL-2 in 22% and IFN gamma in 44% of recipients in the first 6 months. Only 30% expressed IL-10 in the second 6 months post transplant while expression of IL-2 and IFN gamma was detected in 38% and 46% respectively. Thirty-seven percent of PBSCT recipients developed grades II-IV acute GVHD but 72% went on to develop chronic extensive GVHD at a median of 120 days. Sixty-two percent developed CMV viremia and 5.4% developed overt CMV disease in the first year post PBSCT. Lymphocyte engraftment is quantitatively delayed but CD4 functions are preserved while NK numbers and function are compromised post PBSCT. IL-10 expression decreases after the first 6 months post transplant while TNF alpha is continually expressed. The balance between quantitative lymphocyte reconstitution and qualitative lymphocyte functions as well as changes in lymphokine patterns may influence infection and GVHD and thus the clinical outcome post PBSCT.