Interferon-beta (IFN-beta) has beneficial effects on the clinical symptoms of multiple sclerosis (MS) patients, but its exact mechanism of action is yet unknown. We here suggest that IFN-beta directly modulates inflammatory events at the level of cerebral endothelium. IFN-beta treatment resulted in a marked reduction of perivascular infiltrates in acute experimental allergic encephalomyelitis (EAE), the rat model for MS, which was coupled to a major decrease in the expression of the adhesion molecules ICAM-1 and VCAM-1 on brain capillaries. In vitro, IFN-beta reduced the mRNA levels and protein expression of adhesion molecules of brain endothelial cell cultures and diminished monocyte transendothelial migration. Monocyte adhesion and subsequent migration was found to be predominantly regulated by VCAM-1. These data indicate that IFN-beta exerts direct antiinflammatory effects on brain endothelial cells thereby contributing to reduced lesion formation as observed in MS patients.