An inhibitor isolated from the serum-free culture medium of human myeloid leukemic HL-60 cells was able to suppress mitogen- and alloantigen-stimulated proliferative responses of normal lymphocytes in a dose-dependent manner. In vitro production, concentration, and purification by column chromatography and electrophoresis revealed that the inhibitor was produced constitutively, required RNA synthesis, and had a molecular weight in the range of 40,000-60,000. The inhibitor was also produced in vitro by myeloid leukemia cells isolated from patients with acute myelogenous leukemia. In a similar manner, the inhibitory material suppressed proliferative responses of allogeneic and autologous lymphocytes. Suppression was accompanied by drastically reduced production of interleukin 2 and lymphokines, which regulate differentiation of myeloid leukemia cells, and suppression was reversed by addition of exogenous interleukin 2. The inhibitor did not suppress clonogenic proliferation of normal granulocytes and macrophages suggesting that inhibition of production or interference with interleukin 2 activity as a possible mechanism. These interactions between leukemia cells and lymphocytes have shed new light on the immunosuppression and growth advantage of leukemia cells. Inhibitory activity of HL-60 cells was diminished after they were induced to differentiate, indicating that differentiation induced by lymphokines may be an effective means of controlling leukemia.