Leflunomide is an anti-inflammatory and immunosuppressive agent which blocks proliferation of transformed cells and mitogen stimulated normal lymphocytes but does not block T cell signaling mechanisms at antiproliferative concentrations. These properties are consistent with a mechanism involving interference with nucleotide metabolism. Leflunomide had anti-proliferative activity against all cells tested here. The anti-proliferative activities could be reversed by addition of uridine or cytidine to the cultures although some species and cellular differences were observed. Purine nucleotides had no effect. Measurements of nucleotide pools in a human T cell line and mitogen stimulated rat spleen cells treated with leflunomide showed that leflunomide preferentially reduces pyrimidine nucleotide levels. These results indicate that inhibition of pyrimidine biosynthesis is responsible for the anti-proliferative effects of leflunomide.