Inflammation is the clinical expression of chemical mediators such as the pro-inflammatory cytokine tumor necrosis factor (TNF-)-alpha produced by macrophages and other cells activated in the immune response. Hence, agents that can inhibit TNF-alpha may be useful in treating arthritis and other diseases resulting from uncontrolled inflammation. We now report that the cleavage of heparin by the enzyme heparinase I generates sulfated disaccharide (DS) molecules that can inhibit the production of TNF-alpha. Administration of nanogram amounts of the sulfated DS molecules to experimental animals inhibited delayed-type hypersensitivity to a skin sensitizer and arrested the joint swelling of immunologically induced adjuvant arthritis. Notably, the sulfated DS molecules showed a bell-shaped dose-response curve in vitro and in vivo: decreased effects were seen using amounts of the DS molecules higher than optimal. Thus, molecular regulators of inflammation can be released from the natural molecule heparin by the action of an enzyme.