Glucocorticoids (GC) are physiological inhibitors of inflammatory responses and are widely used as anti-inflammatory and immunosuppressive agents in treatment of many autoimmune and allergic diseases. In the present study, we demonstrated that one of the mechanisms by which GC can suppress the immune responses is to inhibit the differentiation and antigen presentation of dendritic cells (DC). DC were differentiated from murine bone marrow hematopoietic progenitor cells by culture with GM-CSF and IL-4 with or without dexamethasone (Dex). Our data showed that Dex, in a dose dependent manner, down-regulated surface expression of CD86, CD40, CD54 and MHC class II molecules by DC, but the expression of MHC class I, CD80, CD95 and CD95L were not affected. In addition, Dex-treated DC showed an impaired function to activate alloreactive T cells and to secrete IL-Ibeta and IL-12p70. Moreover, Dex inhibited DC to present antigen by MHC class II pathway. However, the endocytotic activity of DC was not affected. The inhibitory effect of Dex on the expression of costimulatory molecules and the antigen-presenting capacity of DC could be blocked by the addition of RU486, a potent steroid hormone antagonist, suggesting the requirement of binding to cytosolic receptors in the above-described action of Dex. Since DC have the unique property to present antigen to responding naive T cells and are required in the induction of a primary response, the functional suppression of DC by Dex may be one of the mechanisms by which GC regulate immune responses in vivo.