Defining the mechanisms whereby transforming growth factor-beta (TGF-beta) controls physiologic inflammation and the immune response and how it contributes to pathology when it is dysregulated is critical to our ability to manipulate the levels and activity of this potent cytokine for therapeutic benefit. In keeping with its dichotomous nature, recent evidence suggests that overproduction and/or activation contribute to persistent inflammation and that antagonists of TGF-beta delivered locally can break the cycle of leukocyte recruitment and fibrotic sequelae. On the other hand, systemic routing of TGF-beta can also inhibit inflammatory pathogenesis by multiple mechanisms as exemplified by systemic injections of the protein and by recent gene transfer studies. In addition, enhanced levels of circulating endogenous TGF-beta appear to be an instrument of suppression during the development of oral tolerance, cyclosporin treatment, and following administration of retinoic acid. Although treatment of autoimmune and chronic inflammatory diseases is an important goal, the multiplicity of actions of TGF-beta and the nearly ubiquitous expression of TGF-beta and its receptors dictate a cautious approach to the use of this powerful cytokine as a therapeutic agent.