Culture supernatants from mitogen- and antigen-stimulated human peripheral blood lymphocytes (PBL), stimulated synthesis of the second complement component (C2) by human monocytes, but not as effectively as the stimulated PBL themselves, which adhered to the monocytes and caused marked spreading. In contrast to PBL, lymphocytes isolated from the synovial membranes (SML) of patients with rheumatoid arthritis and their culture supernatants were able to stimulate C2 synthesis without exposure to mitogens or antigens. Depletion of B and T populations showed that T cells were responsible for stimulation of C2 synthesis. Further studies of synthesis rates of C2, C3 factor B (B), C1 inhibitor, and properdin (P) were undertaken, and it was found that lymphocytes and their supernatants increased synthesis of C2, B and C1 inhibitor, and reduced synthesis of C3 and P. This profile of activity was identical to that produced by the addition of recombinant gamma-interferon (rIFN-gamma) to the cultures. Furthermore the addition of a monoclonal antibody to rIFN-gamma to cultures abrogated the effects of rIFN-gamma, and almost completely reversed the effects of lymphocytes and their supernatants. Thus it appears that gamma-interferon is the lymphocyte product which is responsible for the modulation of monocyte complement synthesis. The results of studies with synovial membrane lymphocytes raise the possibility that this process occurs in vivo. Monocyte C2 had a higher specific functional activity (SpFA) than serum C2 isolated from serum or C2 produced by HepG2 cells. Monocyte C2 formed a C3 convertase which had a longer half-life than that found with both serum C2 or HepG2 C2. Thus monocyte C2 behaves like oxidized C2. Monocytes exposed to rIFN-gamma, lymphocytes or lymphocyte-conditioned medium (LCM) produced C2 which had an even higher SpFA. Although antibody to IFN-gamma prevented any increase in C2 synthesis in monocyte cultures containing lymphocytes or LCM, C2 SpFA was still increased. Thus a second lymphocyte product is responsible for this 'oxidation' effect. This production of 'oxidized' C2 by monocytes and further 'oxidation' by the action of either lymphocytes or gamma-interferon might play a significant role in the perpetuation of complement activation at sites of inflammation.