The mechanisms by which tumour cells escape recognition by the immune system or subvert antitumour effector responses remain poorly understood. In the course of investigating the potential of costimulatory signals in anticancer immunotherapy strategies, we have observed that HeLa cells (a human cervical carcinoma cell line) cocultured with peripheral blood lymphocytes (PBL) acquire the capacity to inhibit PBL proliferation in response to interleukin-2 (IL-2). This immuno-inhibitory phenotype was further shown to result from induction of the tryptophan-catabolizing enzyme, indoleamine 2,3-dioxygenase (IDO), by interferon-gamma (IFN-gamma) secreted from cocultured allo-reactive PBL. This enzyme has recently been shown to be a critically important modulator of immunological responses, most notably through the capacity to protect allogeneic concepti from alloreactive maternal lymphocytes. While the cytostatic consequences of IDO activity in tumour cells has received attention, the data presented in this report support the hypothesis that IDO activity may also act to impair antitumour immune responses.