Interferon (IFN)-gamma, a key immunoregulatory cytokine, has been thought to be produced solely by activated T cells and natural killer cells. In this study, we show that murine bone marrow- derived macrophages (BMMPhi) secrete large amounts of IFN-gamma upon appropriate stimulation. Although interleukin (IL)-12 and IL-18 alone induce low levels of IFN-gamma mRNA transcripts, the combined stimulation of BMMPhi with both cytokines leads to the efficient production of IFN-gamma protein. The macrophage-derived IFN-gamma is biologically active as shown by induction of inducible nitric oxide synthase as well as upregulation of CD40 in macrophages. Our findings uncover a novel pathway of autocrine macrophage activation by demonstrating that the macrophage is not only a key cell type responding to IFN-gamma but also a potent IFN-gamma-producing cell.