Muramyl tripeptide phosphatidylethanolamine (MTP-PE), a synthetic lipophilic analogue of muramyl dipeptide (MDP), can be incorporated into the lipid membrane of liposomes. Liposomes containing MTP-PE (L-MTP-PE) stimulated monocytes to selectively kill tumors, but not normal cells in vitro. Furthermore, the activation of monocyte tumoricidal function was demonstrated following the i.v. infusion of L-MTP-PE in a phase I trial with cancer patients. The purpose of this study was to determine the mechanism by which L-MTP-PE activates monocytes. Monocyte tumoricidal function is linked to both interleukin-1 (IL-1) and tumor necrosis factor (TNF). Therefore, normal human monocytes were incubated for various times with L-MTP-PE, empty liposomes, or medium in the presence or absence of gamma interferon (IFN-gamma). The supernatants were removed and assayed for TNF and IL-1 using the L929 and D10.G4.1 assays, respectively. TNF was detected after a 4 hr incubation with L-MTP-PE but not with empty liposomes or medium. TNF secretion peaked at 8 hr and was sustained for up to 72 hr. A 4-fold increase in TNF mRNA levels was demonstrated after 8 hr. An increased level of IL-1 beta mRNA was detected after a 4 hr incubation, but only low level IL-1 secretion was detected in monocytes incubated with L-MTP-PE. Adherent monocytes were frozen and thawed to release intracellular IL-1. Intracellular IL-1 was significantly increased in monocytes incubated with L-MTP-PE. Intracellular IL-1 levels peaked by 8 hr and decreased by 72 hr. Activators were then assayed in the presence or absence of IFN-gamma.(ABSTRACT TRUNCATED AT 250 WORDS)