The alkaloid castanospermine is a potent inhibitor of oligosaccharide processing in vitro. Our recent findings indicating the importance of carbohydrate moieties in some critical step of the neuro-immunologic inflammatory process of allergic encephalomyelitis prompted us to investigate the effect of castanospermine on this disease process. The alkaloid inhibited passively induced allergic encephalomyelitis in a dose-dependent manner when administered continuously for 7 days beginning at the time of lymphocyte transfer. Although clinical disease was totally inhibited, treated animals did have inflammatory lesions in the central nervous system. These lesions were qualitatively different from those seen in untreated animals in that the inflammatory cells were tightly packed around the vessels and showed little migration into surrounding tissues. Castanospermine also effectively inhibited clinical disease in recipient animals which had had a previous episode of allergic encephalomyelitis. Castanospermine did not alter the disease when treatment was started after the onset of clinical symptoms.