We have previously shown that tumor necrosis factor-alpha (TNF alpha) strongly potentiates interleukin-3 (IL-3)-induced short-term proliferation of human CD34+ hematopoietic progenitor cells (HPC). Using longer term cultures of CD34+ HPC, we demonstrate here that this initial potentiation ceases after 10 to 12 days; whereupon TNF alpha displays inhibitory effects. Thus, TNF alpha was found to inhibit cells of granulocytic affiliation while it potentiates the development of maturing cells of the monocytic lineage both in liquid and semi-solid (day 14 colony-forming unit) cultures. TNF alpha was demonstrated to reversibly block granulocytic differentiation at the level of uncommitted CD13-, CD15- blast cells that accumulate in IL-3 + TNF alpha cultures. Furthermore, growth of committed granulocytes (CD15+) from IL-3 cultures was also inhibited by TNF alpha through an arrest of cell cycle in G0/G1. Finally, the use of neutralizing anti-TNF alpha monoclonal antibody and limiting dilution studies indicate that the inhibitory effects of TNF alpha are direct. Taken together, our data demonstrate that, following a phase of potentiation of proliferation of early HPC, TNF alpha displays direct inhibitory effects due to negative interference with both granulocytic differentiation and proliferation of granulocytic cells.