We have investigated the mechanism by which anti-CD28 antibodies activates IFN-gamma production by murine NK cells. These studies reveal that engagement of CD28 alone by this antibody is a poor activator of this cytokine response. Effective stimulation requires simultaneous ligation of the receptor for Fc (FcgammaRIII, CD16) which on its own is also a poor inducer of murine NK cells. The mechanism by which immobilized anti-CD28 increases IFN-gamma mRNA abundance involves both upregulation of transcription as well as induction of mRNA stabilization. However, the elevation of transcription is not as evident as that induced by IL-12 which, in contrast, does not induce message stabilization. Thus ligation of CD28 in the presence of IL-12 results in a synergistic increase in production of the cytokine. Using this assay we have also determined that immobilized anti-CD28 cannot induce resting NK cells to produce IFN-gamma. In contrast, the same cells can be induced by BCL1-C11 tumor cells that express high amounts of the CD28 ligand, B7-2. These studies provide important insights into the ability of cells bearing counter-receptor for CD28 to activate NK cell-cytokine production in vivo.