The 37kDa protein annexin 1 (Anx-1; lipocortin 1) is a glucocorticoid-regulated protein that has been implicated in the regulation of phagocytosis, cell signalling and proliferation, and postulated to be a mediator of glucocorticoids action in inflammation and in the control of anterior pituitary hormone release. Immuno-neutralisation or antisense strategies support this hypothesis as they can reverse the effect of glucocorticoids in several systems. We recently generated a line of mice lacking the Anx-1 gene noting that some tissues taken from such animals exhibited an increased expression of several proteins including COX-2 and cPLA2. In models of experimental inflammation, Anx-1(-/-) mice exhibit an exaggerated response and a partial or complete resistance to the anti-inflammatory effects of glucocorticoids. Several other anomalies were noted including abnormal leukocyte adhesion molecule expression, an increased spontaneous migratory behaviour of PMN in Anx-1(-/-) mice and a resistance in Anx-1(-/-) macrophages to glucocorticoid inhibition of superoxide generation. This paper reviews these and other data in the light of the development of the 'second messenger' hypothesis of glucocorticoid action.