Treatment with human leucocyte interferon (IFN alpha) has been associated with the development of thyroid autoimmunity and hypothyroidism, but it is not certain whether this phenomenon was a result of contamination with IFN gamma, which induced HLA class II antigen expression on T-lymphocytes. We prospectively studied 11 subjects (5 females and 6 males; mean age, 26.8 yr; range, 18-36) with chronic active hepatitis B who were randomized to receive recombinant human IFN gamma (rhIFN gamma; 10(6) U/m2.day, im, 3 times/week) for 16 weeks. Goiter was not present, and no patient had a history or family history of autoimmune diseases. Serial thyroid functions, including serum T4, T3, free thyroid hormone index, free T4 and TSH before, during, and on subsequent follow-up for a period of 1 yr were all normal. Eight patients had adequate serial samples for study of serological and lymphocyte subpopulations. None of the patients treated with rhIFN gamma developed thyroglobulin or thyroid microsomal antibodies. However, four patients developed antinuclear and smooth muscle autoantibodies during or after rhIFN gamma treatment. Treatment with rhIFN gamma resulted in a significant increase in circulating T-lymphocytes and HLA-DR-positive T-cells (P less than 0.05), with equal proportions of circulating CD4+ and CD8+ T-cells becoming DR positive. The percentage of HLA-DR-positive T-cells remained elevated after discontinuation of rhIFN gamma. Also, rhIFN gamma treatment led to a decrease in the number of circulating granulocytes and interleukin-2 receptor-positive cells. In conclusion, we did not observe any thyroid dysfunction or thyroid autoimmunity in our patients treated with the studied dose of rhIFN gamma, but induction of other autoantibodies was observed.