The ability of Nocardia rubra cell wall skeleton (N-CWS) to augment macrophage cytotoxicity function was examined using human pleural macrophages prepared from 32 malignant pleural effusions and 53 pleural washings. The cytostatic activity of pleural macrophages for human lung cancer cells (PC-9) was augmented following incubation of pleural mononuclear cells with 10 micrograms/ml N-CWS for 24 h. Macrophage activity was increased by direct interaction of macrophages with N-CWS or by incubation of macrophages with supernatant culture fluids from pleural lymphocytes with N-CWS. The cytotoxic potential of the pleural macrophages obtained from patients treated with 500 micrograms of N-CWS intrapleurally was also increased. The heat and acid stability studies revealed that the culture fluids from pleural lymphocytes treated with N-CWS contained macrophage activation factor in addition to interferon-gamma. These results suggest that direct and indirect macrophage activation is part of the mechanism in which N-CWS has a clinical effect on malignant pleural effusions.