Diclofenac is associated with a low, but significant, incidence of hepatotoxicity and bone marrow toxicity. It has been suggested that this could be due to a reactive acyl glucuronide. An alternative hypothesis is that an oxidative reactive metabolite could be responsible for such reactions and such metabolites formed by the enzymes present in neutrophils could be responsible for bone marrow toxicity. Others had reported the formation of 2,2'-dihydroxyazobenzene during the oxidation of diclofenac by myeloperoxidase/hydrogen peroxide. In contrast, in similar experiments we did not find evidence for the formation of 2,2'-dihydroxyazobenzene, but we did find several products, including a reactive iminoquinone. The same iminoquinone was formed by the oxidation of 5-hydroxydiclofenac. This iminoquinone was also formed by oxidation of diclofenac by HOCl or by activated neutrophils. It reacted with glutathione to form a conjugate. 5-Hydroxydiclofenac is also a major hepatic metabolite of diclofenac, and we found that rat hepatic microsomes oxidized 5-hydroxydiclofenac to the iminoquinone which was trapped with glutathione. This reactive metabolite represents another possible cause of the idiosyncratic reactions associated with the use of diclofenac.