Leflunomide, a potent disease-modifying antirheumatic drug used in the treatment of rheumatoid arthritis (RA), exhibits anti-inflammatory, antiproliferative and immunosuppressive effects. Although most of the beneficial effects of leflunomide have been attributed to its antimetabolite activity, mainly in T cells, other targets accounting for its potency might still exist. Because of mounting evidence for a prominent role of dendritic cells (DCs) in the initiation and maintenance of the immune response in RA, we analyzed the effect of the active metabolite of leflunomide (A77 1726; LEF-M) on phenotype and function of human myleloid DCs at several stages in their life cycle. Importantly, DCs differentiated in the presence of LEF-M exhibited an altered phenotype, with largely reduced surface expression of the critical co-stimulatory molecules CD40 and CD80. Furthermore, treatment of DCs during the differentiation or maturation phase with LEF-M aborted successful DC maturation. Exogenous addition of uridine revealed that DC modulation by LEF-M was independent of its proposed ability as an antimetabolite. In addition, the ability of DCs to initiate T-cell proliferation and to produce the proinflammatory cytokines IL-12 and tumour necrosis factor-alpha was markedly impaired by LEF-M treatment. As a molecular mechanism, transactivation of nuclear factor-kappaB, an transcription factor essential for proper DC function, was completely suppressed in DCs treated with LEF-M. These data indicate that interference with several aspects of DC function could significantly contribute to the beneficial effects of leflunomide in inflammatory diseases, including RA.