We studied the effect of gamma interferon on 1,25-dihydroxyvitamin D3 (1,25(OH)2D3)-induced differentiation of the human leukaemic cell line U937. Both phenotypic and functional aspects of 1,25(OH)2D3-induced differentiation were significantly augmented by gamma interferon (IFN). Gamma interferon had little effect alone but increased butyrate esterase staining and expression of CD14 antigen and the 40 kD Fc receptor (FcRII) in response to 1,25(OH)2D3. Ability to phagocytose IgG-opsonized bacteria, and superoxide burst in response to both IgG-opsonized bacteria and phorbol ester, was greater after incubation with both IFN and 1,25(OH)2D3 than with either agent alone. The degree of functional activation of cells showed a positive correlation with FcRII expression. In addition, IgG-induced generation of superoxide by differentiated cells was considerably reduced by pre-incubation with the anti-Fc receptor antibody IV3. We conclude that gamma interferon augments 1,25(OH)2D3-induced differentiation and functional activation of the U937 cell line. Increased functional activation may, in part, be due to up-regulation of surface FcR11.