Periodontal ligament (PDL) cells maintain the attachment of the tooth to alveolar bone. These cells reside at a site in which they are challenged frequently by bacterial products and proinflammatory cytokines, such as interleukin-1β (IL-1β), during infections. In our initial studies we observed that IL-1β down-regulates the osteoblast-like characteristics of PDL cells in vitro. Therefore, we examined the functional significance of the loss of the PDL cell’s osteoblast-like characteristics during inflammation. In this report we show that, during inflammation, IL-1β can modulate the phenotypic characteristics of PDL cells to a more functionally significant lipopolysaccharide (LPS)-responsive phenotype. In a healthy periodontium PDL cells exhibit an osteoblast-like phenotype and are unresponsive to gram-negative bacterial LPS. Treatment of PDL cells with IL-1β inhibits the expression of their osteoblast-like characteristics, as assessed by the failure to express transforming growth factor β1 (TGF-β1) and proteins associated with mineralization, such as alkaline phosphatase and osteocalcin. As a consequence of this IL-1β-induced phenotypic change, PDL cells become responsive to LPS and synthesize proinflammatory cytokines. The IL-1β-induced phenotypic changes in PDL cells were transient, as removal of IL-1β from PDL cell cultures resulted in reacquisition of their osteoblast-like characteristics and lack of LPS responsiveness. The IL-1β-induced phenotypic changes occurred at concentrations that are frequently observed in tissue exudates during periodontal inflammation (0.05 to 5 ng/ml). The results suggest that, during inflammation in vivo, IL-1β may modulate PDL cell functions, allowing PDL cells to participate directly in the disease process by assuming LPS responsiveness at the expense of their normal structural properties and functions.