The extinction of fluorescence of scopoletin during its oxidation by horseradish peroxidase (HPO) provides a highly sensitive and specific assay for small quantities of peroxide in solution. With this assay, the release of free H2O2 into the extracellular medium by phagocytizing human granulocytes has been documented and quantitated, and some of the regulating factors have been determined. Under basal conditions granulocytes released less than 0.01 nmol/ml of H2O2 (2.5 X 10-6 polymorphonuclear leukocytes/ml). Upon the addition of phagocyte particles (latex, opsonized yeast, or staphylococci), an abrupt increase in extracellular peroxide concentration was observed (greater than 50-fold above basal levels) after latencies as short as 10 s. Release reflected increased intracellular H2O2 production during phagocytosis in that it paralleled the respiratory burst and was absent when phagocytosis was prevented or when cells from patients with chronic granulomatous disease were utilized. Evidence that scpoletin oxidation occurred predominantly in the extracellular medium was obtained by demonstrating a marked inhibition when HPO was omitted from the reaction mixture or when exogenous catalase was added. Similarly, it was found that exogenous serum also inhibited scopoletin oxidation, apparently because of the presence of competing hydrogen donors. H2O2 formation and release were observed at rates which closely paralleled those of phagocytosis. With O2 consumption as an approximate index of H2O2 formation, the fractions released during maximal rates of particle uptake were calculated as follows: for latex, 15.7%; for staphylococci, 10.3%; and for yeast, 4.9%. It is postulated that release is due to diffusion of free H2O2 from an expanded intracellular pool of this substance that develops during phagocytosis. This poos represents tha net of increased synthesis versus catabolism by various enxymatic pathways for H2O2 disposal within the cells. The close relationship between rates of H2O2 formation and rates of phagocytosis by human granulocytes suggests a role for specialized areas of the cell membrane, involved in particle ingestion, in the trigger mechanism for H2O2 synthesis. The consequences of H2O2 release to other cells or organisms in the immediate environment of phagocytizing granulocytes remain to be determined.