BACKGROUND: Recent data suggest that interferon (IFN)-gamma is not an essential mediator of acute rejection but, instead, is critical for the induction of long-term allograft acceptance. The in vivo mechanisms by which endogenous IFN-gamma regulates the alloimmune response and thus facilitates the induction of long-term allograft survival are not known. METHODS: We examined long-term cardiac and skin allograft survival, alloantigen-induced T-cell proliferation, and alloantigen-induced T-cell apoptosis in wild-type (IFN-gamma+/+) and IFN-gamma gene-knockout (IFN-gamma-/-) mice treated with either B7-CD28 T-cell costimulation blockade alone or B7-CD28 T-cell costimulation blockade combined with donor splenocyte transfusion. RESULTS: We found that IFN-gamma is essential for long-term allograft survival induced by treating mice with either B7-CD28 T-cell costimulation blockade alone or B7-CD28 T-cell costimulation blockade combined with donor splenocyte transfusion. Alloantigen-induced T-cell proliferation in vivo was significantly greater in IFN-gamma-/- mice than in IFN-gamma+/+ mice, and T-cell costimulation blockade abrogated alloantigen-induced T-cell proliferation in wild-type mice but failed to do so in mice that lack IFN-gamma. In contrast, alloantigen-induced T lymphocyte apoptosis in vivo did not differ between IFN-gamma+/+ and IFN-gamma-/- mice, and T-cell costimulation blockade enhanced alloantigen-induced T-cell apoptosis in both mouse strains. CONCLUSIONS: These data suggest that endogenous IFN-gamma facilitates the induction of long-term allograft survival by limiting the proliferation of alloactivated T lymphocytes. The data also suggest that B7-CD28 T-cell costimulation blockade exerts immunosuppressive actions by inhibiting the proliferation of activated T lymphocytes and by promoting their apoptosis.