The purpose of this investigation was to study the mechanism of action of a macrophage-derived factor that stimulates steroid production by Leydig cells. This factor increased testosterone production within 30 min, and reached a half-maximal response by 6-8 h. At a maximal dose, it stimulated testosterone production 20-fold at 24 h. Its efficacy was consistently higher than that achieved with a maximal dose of human chorionic gonadotropin (hCG). However, Leydig cells treated with a maximal dose of both the macrophage-derived factor and hCG secreted the same amount of testosterone as when given a maximal dose of only the macrophage-derived factor. The macrophage-derived factor did not require new protein synthesis to stimulate testosterone production, nor did it alter the amount of steroidogenic acute regulatory protein (StAR). While the macrophage-derived factor required an active cholesterol side-chain cleavage complex system, it did not alter the capacity of this enzyme complex. Finally, the macrophage-derived factor was unable to stimulate the production of progesterone by isolated mitochondria. In summary, the macrophage-derived factor is a highly active, acute regulator of steroidogenesis that acts through a high capacity StAR-independent pathway.