Thrombomodulin (TM), a key cofactor of the TM-protein C pathway, is of major biologic significance for the antithrombotic properties of endothelial cells. Yet, there is uncertainty whether TM is expressed in brain and what mechanisms govern brain endothelial anticoagulant activity. In this study, bovine brain capillaries were used as an in vitro model of the blood-brain barrier to determine factors involved in the regulation of TM expression in cerebral vasculature. Quantitative competitive-polymerase chain reaction assay revealed significant regional differences in the amount of brain capillary TM mRNA, i.e., cortical > cerebellar > pontine, consistent with the reverse transcription-polymerase chain reaction findings in which the abundance of TM mRNA was analyzed relative to beta-actin mRNA. Regional differences in TM mRNA brain capillary level correlated well with differences in protein C activation. The TM mRNA and activity were not detectable in brain parenchyma. Pathogenic mediators of ischemic stroke, interleukin 1 beta (10 U/mL), and tumor necrosis factor alpha (10 U/mL), produced a time-dependent decrease in brain capillary TM mRNA (t1/2 of 2.1 and 3.9 hours, respectively) and reduced endothelial TM activity. Incubation of brain capillaries with retinoic acid (10 mumol/L) and dibutyryl cAMP (3 mmol/L) resulted in a 4-fold increase in TM mRNA at 4 and 8 hours, respectively, followed by an increase in protein C activation. We conclude that TM at the blood-brain barrier is likely to be an important physiologic anticoagulant in brain microcirculation. Its downregulation by cytokines may contribute to ischemic brain damage and potentially could be counteracted by retinoic acid and cAMP.