Interferon-gamma (IFN-gamma), an immunoregulatory cytokine produced by activated T cells and natural killer cells in response to viral infection or other stimuli, is generally recognized as a suppressor of hematopoiesis. IFN-gamma inhibited in vitro colony formation by granulocyte-macrophage (GM), erythroid and multipotential progenitors. This cytokine exerted direct suppression on the proliferation process, but not on the commitment, of GM progenitors. The antiproliferative effects of IFN-gamma may, in part, result from the prolongation of the doubling time of GM progenitors. Clinically, IFN-gamma may play an important role in the pathogenesis of pancytopenia in aplastic anemia and in the hemophagocytic syndrome. However, as well as showing inhibitory effects, IFN-gamma increased the number of pure and mixed megakaryocyte colonies formed by post-5-fluorouracil treated bone marrow cells and, moreover, the addition of IFN-gamma to culture containing stem cell factor resulted in a synergistic effect on the development of both primitive hematopoietic progenitors and mature populations. These findings suggest that IFN-gamma has bifunctional activity in hematopoiesis.