Although thalidomide (alpha-phthalimidoglutarimide) is a potent teratogen, in recent years it has become widely used in the treatment of a variety of diseases. Despite many studies, the mechanism of its teratogenic action is still not clear. Recently we reported that only the glutarimide moiety bound to rat embryonic DNA. This result could explain our earlier observation, that thalidomide induced alteration in the secondary structure of rat embryonic DNA. In this study it was shown that [glutarimide-2-14C]-thalidomide also interacts with the DNA of rabbit embryos. This interaction is a possible explanation for the diverse types of malformations caused by thalidomide and may also account for its immunosuppressant action which makes it useful in the treatment of graft-versus-host disease.