Human articular chondrocytes in monolayer culture and fragments of human articular cartilage were treated with recombinant human interferon gamma (IFN-gamma) both alone and in combination with interleukin 1 (IL-1). IFN-gamma alone inhibits metalloproteinase production, as measured in the caseinase assay, and decreases glycosaminoglycan release from cartilage fragments in culture. The synthesis of DNA, as measured by [3H]thymidine incorporation, is stimulated by IFN-gamma. Similar effects are seen in the presence of IL-1. Thus, IFN-gamma opposes the stimulatory effect of IL-1 on caseinase production and decreases IL-1-stimulated cartilage degradation, as measured by glycosaminoglycan release. In contrast, IFN-gamma has no effect on IL-1-stimulated prostaglandin production, and acts synergistically with IL-1 to cause a large stimulation of DNA synthesis. These results show that IFN-gamma has a number of effects on articular chondrocytes in-vitro and suggest a possible role for IFN-gamma in limiting cartilage degradation in inflammatory joint conditions.