In the 35 years since the discovery of interferon, significant biological activity has been described for interferon-alpha (IFN alpha) in various cancers, particularly haematological malignancies such as hairy cell leukaemia and chronic myelogenous leukaemia. Except for localised therapy in bladder and ovarian cancer, activity against most solid tumours has been disappointing. Other notable exceptions include Kaposi's sarcoma, renal cell carcinoma and malignant melanoma, tumours known to be susceptible to immunological attack. More recently, broad spectrum antiviral activity has been demonstrated for both recombinant and naturally occurring IFN alpha. Hepatitis C is responsive to IFN alpha in about 40% of patients, but long term remissions are rare. In contrast, long term suppression of hepatitis B is common following IFN alpha therapy. Both diseases respond in a dose proportional fashion, with daily doses of 5 million units (MU) significantly more effective than lower doses. The mechanism of action in viral diseases involves the expression of unique antiviral proteins such as endonuclease and 2'-5'-oligoadenylate synthetase which enhance the destruction of viral RNA. General cellular protein synthesis is also inhibited, including cytochrome P450 enzymes. This forms the basis for potential drug interactions, with IFN alpha slowing the clearance of highly metabolised drugs such as theophylline. As an antitumour agent, the mechanism of action of IFN alpha is unclear, particularly in haematological cancers. In melanoma and renal cell carcinoma, antitumour effects may be mediated by augmented immune responses including activation of natural killer lymphocytes and enhanced expression of cell surface antigens (e.g. MHC I and II). Conversely, antibody formation to recombinant IFN alpha may result in a loss of activity. This has been observed in both renal cell cancer and hepatitis B and C. The elimination half-life of IFN alpha is short, 4 to 5 hours, but biological activity extends for 2 to 3 days after administration, which facilitates daily or thrice weekly administration. Clearance of IFN alpha is mediated by catabolism in the renal tubules; no intact drug is excreted in the urine. It is probable that the antiviral indications of IFN alpha will expand as the agent is more clearly recognised as a primary endogenous defence against various viral conditions.