Tumor invasion and metastasis are regulated by the expression of genes such as E-cadherin, which regulates cell adhesion, and matrix metalloproteinase-9 (MMP-9), which alters the integrity of the extracellular matrix. Both up-regulation of MMP-9 and down-regulation of E-cadherin correlate with bladder cancer metastasis. The purpose of this study was first to determine whether an imbalance between MMP-9 and E-cadherin expression correlates with metastasis from human transitional cell carcinoma (TCC) of the bladder after therapy with neoadjuvant chemotherapy and radical cystectomy and then to determine whether treatment of human TCC xenografts growing in nude mice with interferon (IFN)-alpha would restore this balance, thereby limiting tumor invasion and metastasis. We used in situ hybridization to evaluate the expression of several metastasis-related genes, including MMP-9 and E-cadherin, in paraffin-embedded biopsy specimens from 55 patients with muscle-invasive TCC treated with neoadjuvant methotrexate, vinblastine, doxorubicin, and cisplatin chemotherapy and radical cystectomy. By multivariate analysis, an MMP-9:E-cadherin ratio of >1.8 was an independent prognostic factor for disease progression. In vitro incubation of an IFN-resistant, highly metastatic human TCC cell line, 253J B-V(R) with noncytostatic concentrations of IFN-alpha down-regulated the activity of MMP-9, up-regulated E-cadherin, and inhibited in vitro invasion. 253J B-V(R) cells were implanted into the bladders of athymic nude mice. Systemic therapy with IFN-alpha (10,000 units s.c. daily) decreased the expression of MMP-9, increased expression of E-cadherin, reduced tumor volume, and inhibited metastasis. The MMP-9:E-cadherin ratio was 4.5 in untreated controls and 1.1 after IFN-alpha treatment. Moreover, systemic low-dose daily IFN-alpha potentiated the efficacy of paclitaxel. These studies indicate that in addition to its antiproliferative and antiangiogenic effects, IFN-alpha limits tumor invasion by restoring the normal balance between MMP-9 and E-cadherin and enhances the activity of systemic chemotherapy.