Qinghaosu, isolated and purified from the Chinese herb, Artemisia annua Linn, and identified as a sesquiterpene with a peroxide bridge and lactone structure, is a highly potent and non-toxic new antimalaria drug. This paper reports the immunosuppressive action of its water soluble derivative (hemisuccinate NA, QHS). The remarkable suppression by QHS of the in vitro 3HTdR incorporation by mitogen-stimulated mouse spleen cells and human peripheral lymphocytes, as well as the spontaneous incorporation by mouse thymocytes and blood cells from some leukemia patients is presented and its characteristics are described. The in vivo effect as shown by quantitative PFC is studied and the difference between the present in vitro and in vivo effects is investigated. The possible mechanism of inhibition and discrepancy in effects are discussed.