The present studies demonstrate that dimethylsulfoxide (DMSO) treatment of human ll-937 myelomonocytic leukemia cells is associated with induction of monocytic diiferentiation. The DMSO-induced U-937 monocytic phenotype was associated with 1) growth inhibition, 2) loss of clonogenic survival, 3) increases in a-naphthyl acetate esterase (NSE) staining, and 4) increases in cell surface expression of the monocyte marker Mac-1. DMSO treatment of U-937 cells was also associated with down-regulation of c-myc and c-myb gene expression as well as with increases in tumor necrosis factor (TNF) mRNA levels. The results further demonstrate that induction of U-937 monocytic difierentiation by DMSO is accompanied by increases in phospholipase A, activity. Moreover, this stimulation of phospholipase A, was sensitive to dexamethasone. We therefore studied the effects of dexamethasone on DMSO-induced difierentiation of U-937 cells. Although dexamethasone had no efiect on growth inhibition or loss of clonogenic survival by DMSO', this glucocorticoid blocked increases in NSE staining and cell surface Mac-I expression. Dexamethasone also had no effect on the down-regulation of c-myc and c-myb expression but blocked the reappearance of c-myb transcripts after 6 hr of DMSO treatment. Finally, dexamethasone inhibited DMSO-induced increases in TNF gene expression. Taken together, the results demonstrate that dexamethasone inhibits rnulkiple characteristics, including the stimulation of phospholipase A, aclivity, associated with DMSO-induced monocytic differrntiation o i U-937 cells.