Interferon substantially induced indoleamine 2,3-dioxygenase and increased L-tryptophan metabolism in human peripheral blood monocytes. The induction of dioxygenase by gamma-interferon was significantly higher than that observed with alpha-interferon. This cytokine-dependent induction of the enzyme was markedly and differentially altered by antiinflammatory drugs (i.e., acetaminophen, 3-deazaadenosine, indomethacin and dexamethasone). Dexamethasone potentiated the effect of gamma-interferon and resulted in "super-induction" of the enzyme. This is the first demonstration of the interferon-elicited induction of the dioxygenase in the cells of the immune system and of a novel mechanism for regulating tryptophan metabolism in the cells.