We have previously reported that intravenous administration of cationic lipid-protamine-DNA complexes (LPD) induces production of large quantities of proinflammatory cytokines that are toxic and cause inhibition of transgene expression. Cytokine induction appears to be mediated by the unmethylated CpG sequences since methylation of plasmid DNA significantly decreases the cytokine levels. In this study, the inhibitory role of CpG in lipid-mediated gene transfer was further investigated using chemically well-defined, CpG-containing oligodeoxynucleotides (ODNs). Injection (intravenous) of ODNs formulated in LPD into mice triggered production of proinflammatory cytokines including interferon gamma and TNF-alpha. The potency of CpG-containing ODNs in cytokine induction was affected by its flanking sequences and was significantly reduced when CpG was methylated. Preinjection of ODN-containing LPD led to inhibition of transgene expression in lungs after a subsequent injection of LPD containing plasmid expression vector with luciferase gene. The degree of inhibition correlated with the levels of ODN-triggered cytokines. Finally, intraperitoneal injection of dexamethasone suppressed LPD-induced cytokine production, and led to significantly higher levels of transgene expression on both first and second injection. These studies suggest that mutation of potent CpG motifs in plasmid DNA together with the use of immune suppression agent may represent an effective approach to improve cationic lipid-mediated gene transfer to the lung.