It is undeniable that glucocorticoids are remarkably effective in the therapeutic management of allergic diseases such as rhinitis, atopic dermatitis, and asthma. The potent synthetic drugs used clinically are analogues of the endogenous adrenal hormone cortisol. A growing body of evidence now suggests that endogenous cortisol, which is produced in significant quantities by the body in a diurnal rhythm, is an important regulator of allergic disease expression and allergic inflammatory responses: lung function varies along with plasma cortisol levels; the number of circulating inflammatory cells varies with plasma cortisol levels; and low levels of endogenous cortisol may be associated with risk for asthma. Treatment studies suggest that the administration of inhaled or oral steroids is probably more effective when given in the evening when endogenous cortisol levels are low. Conversely, challenge studies show clearly that antigen-induced late-phase responses occur less readily if the challenge is performed in the morning at a time when endogenous cortisol levels are high. Finally, inflammatory responses may induce the production of cortisol by the hypothalamic-pituitary-adrenal axis as a feedback mechanism. Paradoxically, some inflammatory cytokines may induce resistance of inflammatory cells to glucocorticoids. The available information describes a complex yet balanced interplay between adrenal cortisol production and allergic inflammation.