Abstract Pooled human intravenous immunoglobulin (IVIg) has been used successfully to treat or ameliorate the clinical manifestations of humoral immune deficiencies, haematological disorders, HIV infection and many other diseases states. However, the mechanism of action of IVIg remains unclear. Several mechanisms of action of IVIg have been proposed. These include Fcγ receptor blockade, accelerated clearance of endogenous pathogenic auto-antibodies, inhibition of components of the complement cascade, neutralization of super-antigens and bacterial toxins as well as anti-cytokine and anti-idiotype effects. A major contributor to host immunity and immune surveillance against infection, tissue or cell damage and malignancy is the monocyte/macrophage system. Monocyte-directed inflammation is a desirable consequence of microbiological or malignant challenge. However, monocyte hyperactivity may contribute to certain pathological conditions. These include the systemic inflammatory response syndrome (SIRS), septic shock, other dysregulated inflammatory disorders and auto-immunity. Novel therapies that can suppress the hyperactive state or correct monocyte/macrophage dysfunction without compromising normal host cell-mediated immunity are desirable. In this review, we discuss the immunomodulatory effects of IVIg focussing particularly upon the monocyte/macrophage system in pertinent disease states.