In this study we show that both cultured normal human epidermal cells (EC) and a human squamous cell carcinoma (SCC) cell line produce a thymocyte-activating factor (ETAF). EC-ETAF and SCC-ETAF both have a Mr of 15,000 and were eluted from chromatofocusing at the same isoelectric points of 7.2, 5.8, and 5.0. Both activities were maintained at alkaline pH and were destroyed at temperatures above 60 degrees C. In addition to stimulating thymocyte proliferation, human ETAF exhibited a variety of other pertinent biologic activities. Although EC-ETAF or SCC-ETAF by themselves exhibited no T-cell growth factor activity, both ETAF preparations enhanced Interleukin 2 production by cultured human peripheral blood lymphocytes when stimulated with polyclonal T-cells stimulants (Concanavalin A and phorbol myristate acetate). Human ETAF also was chemotactic for rabbit polymorphonuclear leukocytes and was directly mitogenic for cultured human dermal fibroblasts. Injection of human ETAF into C3H/HeJ mice, resulted in inducing serum amyloid A (SAA) production by murine hepatocytes. The thymocyte growth-enhancing activity, the fibroblast-stimulating activity, and the SAA-inducing capacity of ETAF all coeluted off AcA54 gel. These biologic as well as biochemical properties of human keratinocyte-derived ETAF are identical with those of human macrophage-derived Interleukin 1. The ability of keratinocytes to release an immunomodulating factor with such diverse consequences may play an important role in normal wound healing and in diseases involving epithelial tissues.