Incubation of vascular endothelial cells with S.typhosa endotoxin and interferon-gamma caused a time- and concentration-dependent reduction in the viability of the cells. The cytotoxic effect was inhibited in a concentration-dependent manner by NG-monomethyl-L-arginine, an inhibitor of nitric oxide (NO) synthesis, and by the glucocorticoids dexamethasone and hydrocortisone, two inhibitors of the induction of NO synthase. These findings indicate that in these cells the cytotoxic effect of endotoxin is mediated by the NO synthesized by an inducible NO synthase. This induction of NO synthase in vascular endothelial cells may represent a mechanism of local endothelial damage during endotoxin shock and other immunologically based conditions.