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We have examined the mechanism of thalidomide inhibition of lipopolysaccharide (LPS)-induced tumor necrosis factor alpha (TNF- alpha) production and found that the drug enhances the degradation of TNF-alpha mRNA. Thus, the half-life of the molecule was reduced from approximately 30 to approximately 17 min in the presence of 50 micrograms/ml of thalidomide. Inhibition of TNF-alpha production was selective, as other LPS-induced monocyte cytokines were unaffected. Pentoxifylline and dexamethasone, two other inhibitors of TNF-alpha production, are known to exert their effects by means of different mechanisms, suggesting that the three agents inhibit TNF-alpha synthesis at distinct points of the cytokine biosynthetic pathway. These observations provide an explanation for the synergistic effects of these drugs. The selective inhibition of TNF-alpha production makes thalidomide an ideal candidate for the treatment of inflammatory conditions where TNF-alpha-induced toxicities are observed and where immunity must remain intact.